UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549FORM 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, 2004or

[ ]  Transition Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from ___________to _____________
Commission File #0-18431Inland 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 | 60523     
|------------------------------------------ | ----------
|(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

Indicate by a checkmark whether the registrant is an accelerated filer (as defined in Securities Exchange Act Rule 12b-2)    Yes    No X

-1-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Balance Sheets
March 31, 2004 and December 31, 2003
(unaudited)



Assets



|                                                                                                                                                                                          |   | 2004       | 2003      
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ---------- | ----------
|Current assets:                                                                                                                                                                           |   |            |           
|Cash and cash equivalents (Note 1)                                                                                                                                                        | $ | 6,755,781  | 965,756   
|Accounts and accrued interest receivable (net of allowance for doubtful     accounts of $969,028 at March 31, 2004 and December 31, 2003) (Note 5)                                        |   | 11,168     | 392       
|Mortgage loans receivable (net of allowance for doubtful accounts of     $2,101,007 at March 31, 2004 and December 31, 2003) (Note 5)                                                     |   | -          | -         
|Other current assets                                                                                                                                                                      |   | 17,751     | 6,816     
|                                                                                                                                                                                          |   |            |           
|Total current assets                                                                                                                                                                      |   | 6,784,700  | 972,964   
|                                                                                                                                                                                          |   |            |           
|Other assets                                                                                                                                                                              |   | 16,840     | 16,840    
|Deferred loan fees (net of accumulated amortization of $60,963 and 
  $57,399 at March 31, 2004 and December 31, 2003, respectively)                                                      |   | 16,544     | 20,108    
|Investments in land and improvements, at cost (including acquisition fees paid   to Affiliates of $497,036 and $704,853 at March 31, 2004 and December   31, 2003, respectively) (Note 3) |   | 14,682,828 | 20,517,279
|                                                                                                                                                                                          |   |            |           
|Total assets                                                                                                                                                                              | $ | 21,500,912 | 21,527,191
|                                                                                                                                                                                          |   |            |           



See accompanying notes to financial statements.

-2-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Balance Sheets
(continued)
March 31, 2004 and December 31, 2003
(unaudited)Liabilities and Partners' Capital



|                                                                                                                                                                                                     |   | 2004         | 2003        
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | - | ------------ | ------------
|                                                                                                                                                                                                     |   |              |             
|Current liabilities:                                                                                                                                                                                 |   |              |             
|Accounts payable                                                                                                                                                                                     | $ | 169,603      | 3,455       
|Accrued real estate taxes                                                                                                                                                                            |   | 67,357       | 55,718      
|Due to Affiliates (Notes 2 and 6)                                                                                                                                                                    |   | 375,920      | 351,391     
|Current portion of notes payable to Affiliate (Note 6)                                                                                                                                               |   | 1,515,000    | 1,515,000   
|Unearned income                                                                                                                                                                                      |   | 22,498       | 19,280      
|                                                                                                                                                                                                     |   |              |             
|Total current liabilities                                                                                                                                                                            |   | 2,150,378    | 1,944,844   
|                                                                                                                                                                                                     |   |              |             
|Notes payable to Affiliate, less current portion (Note 6)                                                                                                                                            |   | 941,682      | 941,682     
|                                                                                                                                                                                                     |   |              |             
|Total liabilities                                                                                                                                                                                    |   | 3,092,060    | 2,886,526   
|                                                                                                                                                                                                     |   |              |             
|Partners' capital:                                                                                                                                                                                   |   |              |             
|General Partner:                                                                                                                                                                                     |   |              |             
|Capital contribution                                                                                                                                                                                 |   | 500          | 500         
|Cumulative net income                                                                                                                                                                                |   | 3,570,290    | 1,435,462   
|Cumulative cash distributions                                                                                                                                                                        |   | (3,554,592)  | (1,419,042) 
|                                                                                                                                                                                                     |   |              |             
|                                                                                                                                                                                                     |   | 16,198       | 16,920      
|Limited Partners:                                                                                                                                                                                    |   |              |             
|Units of $1,000. Authorized 30,001 Units, 29,593 outstanding at 
      March 31, 2004 and December 31, 2003, (net of offering costs of       $3,768,113, of which $1,069,764 was paid to Affiliates) |   | 25,873,403   | 25,873,403  
|Cumulative net income                                                                                                                                                                                |   | 22,589,157   | 14,955,798  
|Cumulative cash distributions                                                                                                                                                                        |   | (30,069,906) | (22,205,456)
|                                                                                                                                                                                                     |   |              |             
|                                                                                                                                                                                                     |   | 18,392,654   | 18,623,745  
|                                                                                                                                                                                                     |   |              |             
|Total Partners' capital                                                                                                                                                                              |   | 18,408,852   | 18,640,665  
|                                                                                                                                                                                                     |   |              |             
|Total liabilities and Partners' capital                                                                                                                                                              | $ | 21,500,912   | 21,527,191  
|                                                                                                                                                                                                     |   |              |             

See accompanying notes to financial statements.

-3-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Statements of Operations
For the three months ended March 31, 2004 and 2003
(unaudited)

|                                                                                                                                                                         |   | 2004       | 2003    
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | - | ---------- | --------
|                                                                                                                                                                         |   |            |         
|Income:                                                                                                                                                                  |   |            |         
|Sale of investments in land and improvements (Note 3)                                                                                                                    | $ | 15,967,375 | -       
|Rental income (Note 4)                                                                                                                                                   |   | 43,357     | 60,281  
|Interest income                                                                                                                                                          |   | 11,864     | 3,028   
|Other income                                                                                                                                                             |   | 30,000     | -       
|                                                                                                                                                                         |   |            |         
|                                                                                                                                                                         |   | 16,052,596 | 63,309  
|                                                                                                                                                                         |   |            |         
|Expenses:                                                                                                                                                                |   |            |         
|Cost of land and improvements sold                                                                                                                                       |   | 6,056,976  | -       
|Professional services to affiliates                                                                                                                                      |   | 12,649     | 7,255   
|Professional services to non-affiliates                                                                                                                                  |   | 35,273     | 31,000  
|General and administrative expenses to affiliates                                                                                                                        |   | 5,805      | 6,881   
|General and administrative expenses to non-affiliates                                                                                                                    |   | 134,474    | 9,386   
|Marketing expenses to affiliates                                                                                                                                         |   | 4,996      | 3,193   
|Marketing expenses to non-affiliates                                                                                                                                     |   | 10,138     | 10,404  
|Land operating expenses to non-affiliates                                                                                                                                |   | 20,534     | 25,074  
|Amortization                                                                                                                                                             |   | 3,564      | 8,471   
|                                                                                                                                                                         |   |            |         
|                                                                                                                                                                         |   | 6,284,409  | 101,664 
|                                                                                                                                                                         |   |            |         
|Net income (loss)                                                                                                                                                        | $ | 9,768,187  | (38,355)
|                                                                                                                                                                         |   |            |         
|Net income (loss) allocated:                                                                                                                                             |   |            |         
|General partner                                                                                                                                                          | $ | 2,134,828  | (384)   
|Limited partners                                                                                                                                                         |   | 7,633,359  | (37,971)
|                                                                                                                                                                         |   |            |         
|Net income (loss)                                                                                                                                                        | $ | 9,768,187  | (38,355)
|                                                                                                                                                                         |   |            |         
|Net income (loss) allocated to the one general partner unit                                                                                                              | $ | 2,134,828  | (384)   
|                                                                                                                                                                         |   |            |         
|Net income (loss) per unit allocated to limited partners per weighted   average limited partnership units (29,593 for the three months
   ended March 31, 2004 and 2003) | $ | 257.94     | (1.28)  
|                                                                                                                                                                         |   |            |         



See accompanying notes to financial statements.

-4-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Statements of Cash Flows
For the three months ended March 31, 2004 and 2003
(unaudited)

|                                                                                              |   | 2004         | 2003     
|--------------------------------------------------------------------------------------------- | - | ------------ | ---------
|Cash flows from operating activities:                                                         |   |              |          
|Net income (loss)                                                                             | $ | 9,768,187    | (38,355) 
|Adjustments to reconcile net income (loss) to net cash provided by
     operating activities: |   |              |          
|Gain on sale of investments in land and improvements                                          |   | (9,910,399)  | -        
|Amortization                                                                                  |   | 3,564        | 8,471    
|Changes in assets and liabilities:                                                            |   |              |          
|Accounts and accrued interest receivable                                                      |   | (10,776)     | (2,158)  
|Other assets                                                                                  |   | (10,935)     | (2,038)  
|Accounts payable                                                                              |   | 166,148      | 599      
|Accrued real estate taxes                                                                     |   | 11,639       | 21,241   
|Due to affiliates                                                                             |   | 24,529       | 69,371   
|Unearned income                                                                               |   | 3,218        | 128,317  
|                                                                                              |   |              |          
|Net cash provided by operating activities                                                     |   | 45,175       | 185,448  
|                                                                                              |   |              |          
|Cash flows from investing activities:                                                         |   |              |          
|Additions to investments in land and improvements                                             |   | (222,525)    | (280,258)
|Proceeds from disposition of investments in land and improvements                             |   | 15,967,375   | -        
|                                                                                              |   |              |          
|Net cash provided by (used) in investing activities                                           |   | 15,744,850   | (280,258)
|                                                                                              |   |              |          
|Cash flows from financing activities:                                                         |   |              |          
|Cash distributions                                                                            |   | (10,000,000) | -        
|                                                                                              |   |              |          
|Net cash flows used in financing activities                                                   |   | (10,000,000) | -        
|                                                                                              |   |              |          
|Net increase (decrease) in cash and cash equivalents                                          |   | 5,790,025    | (94,810) 
|Cash and cash equivalents at beginning of period                                              |   | 965,756      | 1,350,883
|                                                                                              |   |              |          
|Cash and cash equivalents at end of period                                                    | $ | 6,755,781    | 1,256,073
|                                                                                              |   |              |          



See accompanying notes to financial statements.

-5-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
March 31, 2004
(unaudited)



Readers of this quarterly report should refer to the Partnership's audited financial statements for the fiscal year ended December 31, 2003, which are included in the Partnership's 2003 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 were 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, 2004, the Partnership has repurchased a total of 407.75 Units for $359,484 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 accounting principles generally accepted in the United States of America ("GAAP") 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 period. Actual results could differ from those estimates.

In the opinion of management, the financial statements contain all the adjustments necessary 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.

Except as described in footnote (b) to Note 4 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.

In January 2003, FASB issued Interpretation No. 46 ("FIN 46") "Consolidation of Variable Interest Entities and Interpretation of Accounting Research Bulletin (ARB) No. 51", which was revised in December 2003.  The primary objectives of FIN No. 46 are to provide guidance on the identification of entities for which control is achieved through means other than through voting rights (Variable Interest Entities) and how to determine when and which business enterprise should consolidate the Variable Interest Entity (the Primary Beneficiary). The effective date for the Partnership is March 31, 2004. FIN 46 does not have a material impact on the Partnership's financial condition and results of operations.

-6-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
March 31, 2004
(unaudited)

(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 $10,934 and $5,672 were unpaid as of March 31, 2004 and December 31, 2003, respectively.

An Affiliate of the General Partner performed 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 $4,996 and $3,193 have been incurred and are included in marketing expenses to Affiliates for the three months ended March 31, 2004 and 2003, respectively, all of which was paid as of March 31, 2004 and December 31, 2003.

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. For the three months ended March 31, 2004 and 2003, the Partnership incurred $63,754 and $100,248, respectively, of such costs. The Affiliate did not recognize a profit on any project. Such costs are included in investments in land and improvements, of which $18,783 and $30,187 were unpaid as of March 31, 2004 and December 31, 2003, respectively.

-7-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)

(3) Investments in Land and Improvements

|       |             |                       |                |   | Initial Costs |             |           |                                  |                  
|------ | ----------- | --------------------- | -------------- | - | ------------- | ----------- | --------- | -------------------------------- | -----------------
|       | Illinois    | Gross Acres Purchased | Purchase/Sales |   | Original      | Acquisition | Total     | Costs  Capitalized Subsequent to | Costs of Property
|Parcel | County      | (Sold)                | Date           |   | Costs         | Costs       | Costs     | Acquisition                      | Sold             
|       |             |                       |                |   |               |             |           |                                  |                  
|1      | Kendall     | 84.7360               | 01/19/89       | $ | 423,680       | 61,625      | 485,305   | 5,462,589                        | 5,947,894        
|       |             | (3.5200)              | 12/24/96       |   |               |             |           |                                  |                  
|       |             | (.3520)               | 11/25/97       |   |               |             |           |                                  |                  
|       |             | (80.8640)             | 12/29/97       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  
|2      | McHenry     | 223.4121              | 01/19/89       |   | 650,000       | 95,014      | 745,014   | 26,816                           | 771,830          
|       |             | (183.3759)            | 12/27/90       |   |               |             |           |                                  |                  
|       |             | (40.0362)             | 05/11/00       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  
|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   | 1,104,919                        | 925,572          
|       |             | (.4860)               | 02/28/91       |   |               |             |           |                                  |                  
|       |             | (27.5750)             | 08/25/95       |   |               |             |           |                                  |                  
|       |             | (4.4000)              | Var 2001       |   |               |             |           |                                  |                  
|       |             | (2.1470)              | Var 2002       |   |               |             |           |                                  |                  
|       |             | (23.1033)             | Var 2003       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  
|5      | Kendall (a) | 372.2230              | 05/03/89       |   | 2,532,227     | 135,943     | 2,668,170 | 456,398                          | 3,124,568        
|       |             | (Option)              | 04/06/90       |   |               |             |           |                                  |                  
|       |             | (372.2230)            | 06/20/03       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  
|6      | Kendall (b) | 78.3900               | 06/21/89       |   | 416,783       | 31,691      | 448,474   | 1,238,975                        | 43,735           
|       |             | (3.9500)              | 11/01/00       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  
|7      | Kendall (b) | 77.0490               | 06/21/89       |   | 84,754        | 8,163       | 92,917    | 1,203,459                        | -                
|       |             |                       |                |   |               |             |           |                                  |                  
|8      | Kendall (b) | 5.0000                | 06/21/89       |   | 60,000        | 5,113       | 65,113    | -                                | 65,113           
|       |             | (5.0000)              | 10/06/89       |   |               |             |           |                                  |                  
|       |             |                       |                |   |               |             |           |                                  |                  

-8-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)

(3) Investments in Land and Improvements (continued)

|       |             |                       |                |   | Initial Costs |             |           |                                 |                  
|------ | ----------- | --------------------- | -------------- | - | ------------- | ----------- | --------- | ------------------------------- | -----------------
|       | Illinois    | Gross Acres Purchased | Purchase/Sales |   | Original      | Acquisition | Total     | Costs Capitalized Subsequent to | Costs of Property
|Parcel | County      | (Sold)                | Date           |   | Costs         | Costs       | Costs     | Acquisition                     | Sold             
|       |             |                       |                |   |               |             |           |                                 |                  
|9      | McHenry (b) | 51.0300               | 08/07/89       | $ | 586,845       | 22,482      | 609,327   | 41,525                          | -                
|       |             |                       |                |   |               |             |           |                                 |                  
|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   | 47,597                          | -                
|       |             |                       |                |   |               |             |           |                                 |                  
|12     | Kendall     | 90.2710               | 10/31/89       |   | 907,389       | 41,908      | 949,297   | 246,964                         | 1,196,261        
|       |             | (.7090)               | 04/26/91       |   |               |             |           |                                 |                  
|       |             | (89.562)              | 03/10/04       |   |               |             |           |                                 |                  
|       |             |                       |                |   |               |             |           |                                 |                  
|13     | McHenry     | 92.7800               | 11/07/89       |   | 251,306       | 19,188      | 270,494   | 18,745                          | 289,239          
|       |             | (2.0810)              | 09/18/97       |   |               |             |           |                                 |                  
|       |             | (90.6990)             | 02/15/01       |   |               |             |           |                                 |                  
|       |             |                       |                |   |               |             |           |                                 |                  
|14     | McHenry     | 76.2020               | 11/07/89       |   | 419,111       | 23,402      | 442,513   | 75,194                          | -                
|       |             |                       |                |   |               |             |           |                                 |                  
|15     | Lake        | 84.5564               | 01/03/90       |   | 1,056,955     | 85,283      | 1,142,238 | 1,661,344                       | 2,803,582        
|       |             | (10.5300)             | Var 1996       |   |               |             |           |                                 |                  
|       |             | (5.4680)              | Var 1997       |   |               |             |           |                                 |                  
|       |             | (68.5584)             | Var 1998       |   |               |             |           |                                 |                  
|       |             |                       |                |   |               |             |           |                                 |                  
|16     | Kane/       | 72.4187               | 01/29/90       |   | 1,273,537     | 55,333      | 1,328,870 | 706,718                         | 2,035,588        
|       | Kendall     | (30.9000)             | 07/10/98       |   |               |             |           |                                 |                  
|       |             | (10.3910)             | 12/15/99       |   |               |             |           |                                 |                  
|       |             | (3.1000)              | 12/12/00       |   |               |             |           |                                 |                  
|       |             | (28.0277)             | 05/19/03       |   |               |             |           |                                 |                  
|       |             |                       |                |   |               |             |           |                                 |                  
|17     | McHenry     | 99.9240               | 01/29/90       |   | 739,635       | 61,038      | 800,673   | 877,704                         | 320,961          
|       |             | (27.5100)             | 01/29/99       |   |               |             |           |                                 |                  

-9-

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)

(3) Investments in Land and Improvements (continued)

|       |          |                       |                |   | Initial Costs |             |            |                                 |                  
|------ | -------- | --------------------- | -------------- | - | ------------- | ----------- | ---------- | ------------------------------- | -----------------
|       | Illinois | Gross Acres Purchased | Purchase/Sales |   | Original      | Acquisition | Total      | Costs Capitalized Subsequent to | Costs of Property
|Parcel | County   | (Sold)                | Date           |   | Costs         | Costs       | Costs      | Acquisition                     | Sold             
|18     | McHenry  | 71.4870               | 01/29/90       | $ | 496,116       | 26,259      | 522,375    | 174,810                         | 11,109           
|       |          | (1.0000)              | Var 1990       |   |               |             |            |                                 |                  
|       |          | (.5200)               | 03/11/93       |   |               |             |            |                                 |                  
|       |          |                       |                |   |               |             |            |                                 |                  
|19     | McHenry  | 63.6915               | 02/23/90       |   | 490,158       | 29,158      | 519,316    | 38,387                          | -                
|       |          |                       |                |   |               |             |            |                                 |                  
|20     | Kane     | 224.1480              | 02/28/90       |   | 2,749,800     | 183,092     | 2,932,892  | 1,938,930                       | 4,871,822        
|       |          | (.2790)               | 10/17/91       |   |               |             |            |                                 |                  
|       |          | (223.869)             | 02/20/04       |   |               |             |            |                                 |                  
|       |          |                       |                |   |               |             |            |                                 |                  
|21     | Kendall  | 172.4950              | 03/08/90       |   | 1,327,459     | 75,822      | 1,403,281  | 954,415                         | 2,357,696        
|       |          | (172.4950)            | Var 1998       |   |               |             |            |                                 |                  
|       |          |                       |                |   |               |             |            |                                 |                  
|22     | McHenry  | 254.5250              | 04/11/90       |   | 2,608,881     | 136,559     | 2,745,440  | 219,416                         | -                
|       |          |                       |                |   |               |             |            |                                 |                  
|23     | Kendall  | 140.0210              | 05/08/90       |   | 1,480,000     | 116,240     | 1,596,240  | 909,395                         | 2,505,635        
|       |          | (4.4100)              | Var 1993       |   |               |             |            |                                 |                  
|       |          | (35.8800)             | Var 1994       |   |               |             |            |                                 |                  
|       |          | (3.4400)              | Var 1995       |   |               |             |            |                                 |                  
|       |          | (96.2910)             | 08/26/99       |   |               |             |            |                                 |                  
|       |          |                       |                |   |               |             |            |                                 |                  
|24     | Kendall  | 298.4830              | 05/23/90       |   | 1,359,774     | 98,921      | 1,458,695  | 63,087                          | 436,638          
|       |          | (12.4570)             | 05/25/90       |   |               |             |            |                                 |                  
|       |          | (4.6290)              | 04/01/96       |   |               |             |            |                                 |                  
|       |          | (69.82)               | 11/26/02       |   |               |             |            |                                 |                  
|       |          |                       |                |   |               |             |            |                                 |                  
|25     | Kane     | 225.0000              | 06/01/90       |   | 2,600,000     | 168,778     | 2,768,778  | 37,083                          | -                
|       |          |                       |                |   |               |             |            |                                 |                  
|       | Totals   |                       |                | $ | 23,624,761    | 1,562,308   | 25,187,069 | 17,505,070                      | 28,009,311       
|       |          |                       |                |   |               |             |            |                                 |                  

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
March 31, 2004
(unaudited)

(3) Investments in Land and Improvements (continued)

1. 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 1990 sale transaction relates to the sale of this option.
2. 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.
3. Reconciliation of investments in land and improvements owned:



|                         |   | March 31,   | December 31
|------------------------ | - | ----------- | -----------
|                         |   | 2004        | 2003       
|                         |   |             |            
|Balance at January 1,    | $ | 20,517,279  | 23,885,361 
|Additions during period  |   | 222,525     | 921,343    
|Sales during period      |   | (6,056,976) | (4,289,425)
|                         |   |             |            
|Balance at end of period | $ | 14,682,828  | 20,517,279 



(4) 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, 2004, the Partnership had farm leases of generally one year in duration, for approximately 965 acres of the approximately 1,218 acres owned.

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INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
March 31, 2004
(unaudited)

(5) Mortgage Loans Receivable

Mortgage loans receivable are the result of sales of Parcels, in whole or in part.  The Partnership has recorded a deferred gain on these sales.  The deferred gain will be recognized over the life of the related mortgage loan receivable as principal payments are received.  As of March 31, 2004, the mortgage loans receivable and the related deferred gain are fully reserved.



|                                     |            |               | Principal Balance | Principal Balance | Accrued Interest Receivable | Deferred Gain
|------------------------------------ | ---------- | ------------- | ----------------- | ----------------- | --------------------------- | -------------
|Parcel                               | Maturity   | Interest Rate | 03/31/04          | 12/31/03          | 03/31/04                    | 03/31/04     
|                                     |            |               |                   |                   |                             |              
|1                                    | 03/01/04   | 9.00%         | $  1,233,215      | 1,233,175         | 423,794                     | 60,752       
|                                     |            |               |                   |                   |                             |              
|15                                   | 12/31/03 * | 9.00%         | 144,557           | 144,557           | 123,358                     | 4,947        
|                                     |            |               |                   |                   |                             |              
|21                                   | 03/31/05   | 9.00%         | 656,050           | 656,050           | 286,779                     | 175,147      
|                                     |            |               |                   |                   |                             |              
|23                                   | 08/26/03 * | 9.00%         | 67,225            | 67,225            | 135,097                     | 1,522        
|                                     |            |               |                   |                   |                             |              
|                                     |            |               | $  2,101,007      | 2,101,007         | 969,028                     | 242,368      
|                                     |            |               |                   |                   |                             |              
|Less allowance for doubtful accounts | 2,101,007  | 2,101,007     | 969,028           | 242,368          
|                                     |            |               |                   |                   |                             |              
|                                     |            |               | $       -         | -                 | -                           | -            

* These loans will be extended.



The General Partner determined that the maximum value of Parcels 1, 15, 21 and 23 could be realized if the parcels were developed and sold as individual lots. However, if we had followed that plan, there is a possibility that the limited partners may have been subject to unrelated business taxable income. Therefore, the Partnership sold the parcels to a third party developer whereby 100% of the sales price was represented by notes receivable from the buyer. These transactions were deemed installment sales. After the sale, the developer, through limited liability companies ("LLCs"), secured third party financing to cover the deferred down payment owed to the Partnership as well as provide proceeds to begin the development of the project. These sales were structured so that the down payment received at the time of the sale was sufficient to provide a distribution to the Limited Partners that equated to the parcel capital allocated to the parcel plus approximately a 6% return per annum on the parcel capital through the date of the distribution.

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---

INLAND LAND APPRECIATION FUND, L.P.
(a limited partnership)
Notes to Financial Statements
(continued)
March 31, 2004
(unaudited)



The General Partner guaranteed the third party development loans owed by these LLCs. In reviewing the developments' financial situation, the General Partner determined that it would be in its best interest to have an affiliate acquire the interests in the LLCs. The General Partner and its affiliates concluded that they could better control the continuing costs to complete these developments and would therefore have the best opportunity to limit their exposure under the guarantee agreements and possibly recover a portion of the amount owed to the Partnership. An affiliate of the General Partner contributed approximately $1,900,000 to acquire the interests in the LLCs. The General Partner contributed approximately $2,400,000 to pay off the debt under its guarantee of the LLC loans. The affiliate of the General Partner will complete the development and the sale of these projects.

(6) Notes Payable to Affiliate

On December 6, 2000, the Partnership obtained a loan from the General Partner in the amount of $1,500,000 collateralized by Parcels 17, 18 and 22. During 2002, the General Partner advanced an additional $15,000. The note accrues interest at prime plus .5% and has a maturity date of November 30, 2004.  For the three months ended March 31, 2004, interest of $20,106 was capitalized.  Accrued interest of $250,027 and $229,921 was unpaid as of March 31, 2004 and December 31, 2003, respectively.

On September 17, 2002, the Partnership obtained a loan from the General Partner in the amount of $1,600,000, collateralized by Parcels 4, 6 and 7.  The note accrues interest at a rate of prime plus .5% and has a maturity date of September 17, 2005.  During 2003, the Partnership made principal payments totaling $658,318 on this note.  The balance outstanding at March 31, 2004 was $941,682.  For the three months ended March 31, 2004, interest of 10,565 was capitalized.  Accrual interest of $96,176 and $85,611 was unpaid as of March 31, 2004 and  December 31, 2003, respectively.

(7)  Subsequent Events

During April 2004, we sold two lots of Parcel 4 for approximately $615,000 and recorded a gain of approximately $312,000.

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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  "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 our 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, the ability to obtain annexation and zoning approvals required to develop our properties; the approval of local governing bodies to develop our properties; successful lobbying of local "no growth" or limited development homeowner groups; adverse changes in real estate, financing and general economic or local conditions; eminent domain proceedings; changes in the environmental conditions or changes in the environmental positions of governmental bodies; and potential conflicts of interest between us and our affiliates, including our general partner.

We electronically file our annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-K and all amendments to those reports with the Securities and Exchange Commission (SEC).  The public may read and copy any of the reports that are filed with the SEC at the SEC's Public Reference Room at 405 Fifth Street, NW, Washington, DC 20549.  The public may obtain information on the operation of the Public Reference room by calling the SEC at (800)-SEC-0330.  The SEC maintains an Internet site at (www.sec.gov) that contains reports, proxy and information statements and other information regarding issuers that file electronically.

Critical Accounting Policies

On December 12, 2001, the Securities and Exchange Commission issued Financial Reporting Release or FRR No. 60 "Cautionary Advice Regarding Disclosure About Critical Accounting Policies."  A critical accounting policy is one that would materially effect our operations or financial condition, and requires management to make estimates or judgements in certain circumstances. We believe that our most critical accounting policies relate to how we value our investment properties and mortgage loans receivable and revenue recognition.  These judgements often result from the need to make estimates about the effect of matters that are inherently uncertain.  The purpose of the FRR is to provide investors with an understanding of how management forms these policies.  Critical accounting policies discussed in this section are not to be confused with accounting principles and methods disclosed in accordance with accounting principles generally accepted in the United States of America or GAAP.  GAAP requires information in financial statements about accounting principles, methods used and disclosures pertaining to significant estimates.  The following disclosure discusses judgements known to management pertaining to trends, events or uncertainties known which were taken into consideration upon the application of those policies and the likelihood that materially different amounts would be reported upon taking into consideration different conditions and assumptions.

Valuation of Investment Properties - On a quarterly basis, in accordance with Statement of Financial Accounting Standards No. 144, we conduct an impairment analysis to ensure that the carrying value of each property does not exceed its estimated fair value.  If this were to occur, we would be required to record an impairment loss equal to the excess of carrying value over fair value.

In determining the value of an investment property and whether the property is impaired, management considers several factors such as projected capital expenditures and sales prices. The aforementioned factors are considered by management in determining the value of any particular property.  The value of any particular property is sensitive to the actual results of any of these uncertain factors, either individually or taken as a whole.  Should the actual results differ from management's judgement, the valuation could be negatively or positively affected.

The valuation and possible subsequent impairment of investment properties is a significant estimate that can and does change based on management's continuous process of analyzing each property.

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Cost Allocation - We use the area method of cost allocation, which approximates the relative sales method of cost 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.

Valuation of Mortgage Loans Receivable - On a quarterly basis, we conduct an analysis to ensure that the carrying value of each mortgage loan receivable is recoverable from the borrower.  If we determine that all or a portion of the receivable is not collectible, we would be required to record an allowance for doubtful accounts equal to the amount estimated to be uncollectible.



The valuation and possible subsequent allowance for doubtful accounts is a significant estimate that can and does change based on management's continuous process of analyzing each mortgage loan receivable.

Revenue Recognition - We recognize income from the sale of land parcels in accordance with Statement of Financial Standards No. 66, "Accounting for Sales of Real Estate".

Liquidity and Capital Resources

On October 12, 1988, we commenced an offering of 10,000 (subject to increase to 30,000) limited partnership units or units pursuant to a Registration Statement on Form S-11 under the Securities Act of 1933.  On October 6, 1989, the offering terminated after we had sold 30,000 units to the public at $1,000 per unit resulting in $30,000,000 in gross offering proceeds, which does not include proceeds from the initial limited partner and the general partner.  All of the holders of our units were admitted to our partnership. Our limited partners share in their portion of benefits of ownership of our real property investments according to the number of units held.

We 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, 2004, we have had multiple sales transactions, through which we have disposed of approximately 1,884 acres of the approximately 3,102 acres originally owned. As of March 31, 2004, cumulative distributions to the limited partners have totaled $30,069,906 (which exceeds the original capital) and $3,554,592 to the general partner. Through March 31, 2004, we have used $17,505,070 of working capital for rezoning and other activities. Such amounts have been capitalized and are included in investments in land.

Our capital needs and resources will vary depending upon a number of factors, including the extent to which we conduct 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 our land, and the amount of revenue received from leasing.  As of March 31, 2004, we own, in whole or in part, twelve of our 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.

At March 31, 2004, we had cash and cash equivalents of approximately $6,755,781, of which approximately $44,500 is reserved for the repurchase of units through the unit repurchase program. The remaining approximately $6,711,000 is available to be used for our costs and liabilities, cash distributions to partners and other activities with respect to some or all of our land parcels.

-15-

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On February 20, 2004, we sold approximately 224 acres of Parcel 20 for $12,500,000. On March 10, 2004, we sold approximately 90 acres of Parcel 12 for $3,500,000. On March 24, 2004, we paid distributions totaling $10,000,000, which includes $7,864,450 paid to the limited partners and $2,135,550 paid to the general partner.  In addition to these sales which occurred in 2004, we anticipate additional sales of Parcels 4, 6 and 7 in 2004. Proceeds from these sales will be used to reduce the note payable to our general partner. Undistributed net sales proceeds will be used to cover our operations, including property upgrades, and to repay the note payable to our general partner, which matures November 30, 2004. We will evaluate our cash needs throughout the year to determine future distributions.

We plan to enhance the value of our land through pre-development activities such as rezoning, annexation and land planning. We have already been successful in, or are in the process of, pre-development activity on several of our land investments. Parcels 4, 6 and 7 have completed two phases of improvements for an industrial park and sites are being marketed. We have also begun planning and zoning on the residential portion of these parcels.  Zoning discussions have begun on Parcel 17, 18 and 22.

Transactions with Related Parties

Our general partner and its affiliates are entitled to reimbursement for salaries and expenses of employees of the general partner and its affiliates relating to our administration. Such costs of $18,454 and $14,136 are included in professional services to affiliates and general and administrative expenses to affiliates for the three months ended March 31, 2004 and 2003, respectively, of which $10,934 and $5,672 was unpaid as of March 31, 2004 and December 31, 2003, respectively.

An affiliate of our general partner performed marketing and advertising services for us and was reimbursed for direct costs. Such costs of $4,996 and $3,193 have been incurred and are included in marketing expenses to affiliates for the three months ended March 31, 2004 and 2003, respectively, all of which was paid as of March 31, 2004 and December 31, 2003.

An affiliate of the general partner performed property upgrades, rezoning, annexation and other activities to prepare our parcels for sale and was reimbursed for salaries and direct costs. For the three months ended March 31, 2004 and 2003, we incurred $75,640 and $100,248, respectively, of such costs. The affiliate did not recognize a profit on any project. Such costs are included in investments in land, of which $18,783 and $30,187 was unpaid as of March 31, 2004 and 2003, respectively.

On December 6, 2000, we obtained a loan from the general partner in the amount of $1,500,000 collateralized by Parcels 17, 18 and 22. During 2002, the general partner advanced an additional $15,000. The note accrues interest at prime plus .5% and has a maturity date of November 30, 2004. The principal balance outstanding at March 31, 2004 was $1,515,000. For the three months ended March 31, 2004, interest of $20,106 was capitalized. Accrued interest of $250,027 and $229,921 was unpaid as of March 31, 2004 and December 31, 2003, respectively.

On September 17, 2002, we obtained a loan from the general partner in the amount of $1,600,000, collateralized by Parcels 4, 6 and 7.  The note accrues interest at a rate of prime plus .5% and has a maturity date of September 17, 2005.  During 2003, we made principal payments totaling $658,318 on this note.  The principal balance outstanding at March 31, 2004 was $941,682.  For the three months ended March 31, 2004, interest of $10,565 was capitalized. Accrued interest of $96,176 and  $85,611 was unpaid as of March 31, 2004 and December 31, 2003, respectively.

Results of Operations

As of March 31, 2004, we owned twelve parcels of land consisting of approximately 1,218 acres. Of the 1,218 acres owned, approximately 965 acres are tillable, leased to local farmers and generate sufficient cash flow to cover property taxes, insurance and other miscellaneous expenses.  Rental income was $43,357 and $60,281 for the three months ended March 31, 2004 and 2003, respectively. The decrease in rental income is due to the decrease in tillable acres as a result of the sale of land.

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Sales of investments in land and improvements of $15,967,375 and cost of land sold of $6,056,976 for the three months ended March 31, 2004 are a result of the sale of approximately 90 acres of Parcel 12 and the sale of approximately 227 acres of Parcel 20.  The increase in sales activity for the three months ended March 31, 2004 is the result of favorable zoning as well as a change in our marketing approach to target homebuilders, industrial users and land developers.

Interest income was $11,864 and $3,028 for the three months ended March 31, 2004 and 2003, respectively. Interest income is primarily a result of cash available to invest on a short term basis during the period as a result of sales proceeds received and interest earned on our mortgage loans receivable.

Professional services to affiliates were $12,649 and $7,255 for the three months ended March 31, 2004 and 2003, respectively.  Professional services to affiliates increased for the three months ended March 31, 2004 compared to the three months ended March 31, 2003, due to an increase in legal services as a result of increased sales activity.

Professional services to non-affiliates were $35,273 and $31,000 for the three months ended March 31, 2004 and 2003, respectively.  Professional services to non-affiliates increased for the year ended December 31, 2003 compared to the year ended December 31, 2002, due to an increase in fees for accounting services.

General and administrative expenses to non-affiliates were $134,474 and $9,386 for the three months ended March 31, 2004 and 2003, respectively.  The increase in 2004 is due to state taxes paid and accrued as a result of the land sales.

Marketing expenses to non-affiliates were $10,138 and $10,404 for the three months ended March 31,  2004 and 2003, respectively.  In 2003 and continuing into 2004, we changed our marketing approach to target homebuilders, industrial users and land developers through direct mailings, newspaper and trade publication advertising and an enhanced website.

Land operating expenses to non-affiliates were $20,534 and $25,074 for the three months ended March 31, 2004 and 2003, respectively. These costs primarily include real estate tax expense, ground maintenance and insurance expense on the parcels we own.



The velocity of the developer's individual lot sales was slower than originally projected and consequently, the developer's carrying costs were higher. The developer obtained a loan from an affiliate of our general partner. These funds were used for operating costs and to continue the development of the projects.  As a result of the slower lot sales, the net sale proceeds available to us are lower than anticipated. As of December 31, 2002, we had recorded an allowance for doubtful accounts of $767,248 relating to a portion of the accrued interest receivable on mortgage loans resulting from the sale of these parcels. In early August 2003, we reviewed recent forecasts on these parcels, and determined that the collectibility of these receivables was doubtful. As a result, we elected to reserve an additional $2,302,787 of principal and accrued interest relating to the mortgages receivable in 2003. The deferred gain of $242,368 relating to the mortgage loans receivable was also reserved and recorded against bad debt expense in 2003.

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Our general partner guaranteed the third party development loans owed by these limited liability companies. In reviewing the developments' financial situation, our general partner determined that it would be in its best interest to have an affiliate acquire the interests in the LLCs. The general partner and its affiliates concluded that they could better control the continuing costs to complete these developments and would therefore have the best opportunity to limit their exposure under the guarantee agreements and possibly recover a portion of the amount owed to us. An affiliate of our general partner contributed approximately $1,900,000 to acquire the interests in these LLCs. Our general partner contributed approximately $2,400,000 to pay off the debt under its guarantee of the LLC loans. The affiliate of the general partner will complete the development and sale of these projects. Based on our review of developments' financial situation in early 2004, we do not anticipate receiving any additional proceeds and anticipate we will write off these receivables in 2004. However, the write-off will not take place until such time as we are certain that no further proceeds will become available to reduce the amount of the receivables. Therefore, it is possible that the write-off will not occur until the later part of 2004. Our limited partners received distributions that equated to the parcel capital plus approximately a 6% return per annum on the parcel capital through the date of the distribution.

Off-Balance Sheet Arrangements, Contractual Obligations, Liabilities and Contracts and Commitments

The table below presents our obligations and commitments to make future payments under debt obligations, maintenance contracts and lease agreements as of March 31, 2004.

|Contractual Obligations | Payments due by period
|----------------------- | ----------------------

|               |   |           | Less than |          
|-------------- | - | --------- | --------- | ---------
|               |   | Total     | 1 year    | 1-3 years
|               |   |           |           |          
|Long-Term Debt | $ | 2,456,682 | 1,515,000 | 941,682  

Item 3. Quantitative and Qualitative Disclosures About Market Risk

Not Applicable.

Item 4.  Controls and Procedures



There were no changes in our internal controls over financial reporting that occurred during the three months ended March 31, 2004 that materially affected, or are reasonably likely to materially affect, our internal control of financial reporting.

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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:

31.1 Rule 13a-14(a)/15d-14(a) Certification by principal executive officer

31.2 Rule 13a-14(a)/15d-14(a) Certification by principal financial officer

32.1 Section 1350 Certification by principal executive officer

32.2 Section 1350 Certification by principal financial officer

(b)  Reports on Form 8-K:

None

-19-

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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/ BRENDA G. GUJRAL                     
|      |                                          
|By:   | Brenda G. Gujral                         
|      | President                                
|Date: | May 14, 2004                             
|      |                                          
|      |                                          
|      | /S/ PATRICIA A. DELROSSO                 
|      |                                          
|By:   | Patricia A. DelRosso                     
|      | Senior Vice President                    
|Date: | May 14, 2004                             
|      |                                          
|      |                                          
|      | /S/ KELLY TUCEK                          
|      |                                          
|By:   | Kelly Tucek                              
|      | Vice President and                       
|      | principal financial officer              
|Date: | May 14, 2004                             

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