UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                     Washington, D.C. 20549
                                
                            FORM 10-K
                                
[X]  ANNUAL REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
     SECURITIES EXCHANGE ACT OF 1934
                                
             For the year ended:  December 31, 1996
                                
                               OR
                                
[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF
     THE SECURITIES EXCHANGE ACT OF 1934
                                
                Commission file number:  33-9921
                                
                                
                    SENIOR INCOME FUND L. P.
      Exact name of Registrant as specified in its charter
                                
                                
           Delaware                            13-3392077
State or other jurisdiction
of incorporation or organization   I.R.S. Employer Identification No.

3 World Financial Center, 29th Floor
New York, NY  Attn.:  Andre Anderson           10285
Address of principal executive offices        zip code

Registrant's telephone number, including area code: (212) 526-3237
                                
Securities registered pursuant to Section 12(b) of the Act:  None
                                
Securities registered pursuant to Section 12(g) of the Act:
                                
                                
   4,827,500 DEPOSITORY UNITS OF LIMITED PARTNERSHIP INTEREST
                         Title of Class
                                
                                
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 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 check mark if disclosure of delinquent filers
pursuant to Item 405 of Regulation S-K is not contained herein,
and will not be contained, to the best of the Registrant's
knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.    X

State the aggregate market value of the voting stock held by non-
affiliates of the registrant:  Not applicable.

DOCUMENTS INCORPORATED BY REFERENCE:    Portions of Parts I, II,
III and IV are incorporated by reference to the Partnership's
Annual Report to Unitholders for the year ended
December 31, 1996.

                             PART I

Item 1. Business

(a)  General Development of Business

Senior Income Fund L.P. (the "Partnership", formerly Shearson
Lehman Senior Income Fund Limited Partnership), a Delaware
limited partnership, was formed on October 14, 1986 pursuant to a
Limited Partnership Agreement, as amended and restated on
March 17, 1987 pursuant to an Amended and Restated Limited
Partnership Agreement (the "Partnership Agreement").  The
Partnership was formed for the purpose of acquiring a general
partnership interest in Shearson August Property Partnership, a
California general partnership (the "Property Partnership"), with
August Financial Partners II ("AFP-II") an affiliate of August
Financial Corporation ("August").

The general partner of the Partnership is Senior Income Fund Inc.
(the "General Partner", formerly Shearson Lehman Senior Income
Fund, Inc.), a Delaware corporation, and wholly owned subsidiary
of Lehman Brothers Inc. (formerly Shearson Lehman Brothers Inc.).
The other general partner, through November 21, 1996, of the
Property Partnership was AFP-II, an affiliate of August.  On
November 21, 1996, the Partnership purchased the general
partnership interest of the successor to AFP-II for a purchase
price of $850,000.  As a result of such purchase, the Property
Partnership will be dissolved and all of its assets will be
distributed to the Partnership.  Accordingly, all sale proceeds
received upon a sale of any property will belong to the
Partnership and no amount will be owed to AFP-II.  The
Partnership will continue until December 31, 2036 unless
terminated earlier pursuant to the provisions of the Partnership
Agreement.

The Property Partnership was formed to acquire, operate and
ultimately sell four specified residential properties for senior
citizens (the "Properties").  For a breakdown of the purchase
price of each of the Properties, see Note 7, "Real Estate," to
the Consolidated Financial Statements of the Partnership's Annual
Report to Unitholders for the year ended December 31, 1996
included in Item 14 of this report.

The Partnership commenced marketing the Properties for sale
during 1996.  See Item 2 "Sale of Properties" for a discussion of
the status of such marketing efforts.  Additional information is
incorporated by reference to Item 7 of this report.

(b)  Financial Information about Industry Segments

Substantially all of the Partnership's revenues, operating profit
or loss and assets relate solely to its interest as general
partner of the Property Partnership whose operating profit or
loss and assets relate to its ownership and operation of the
Properties, until November 21, 1996, at which time the
Partnership purchased AFP-II's general partner interest in the
Property Partnership, as noted in Item 1(a).

(c)  Narrative Description of Business

The Partnership's principal objectives, until the recent
commencement of marketing the Properties for sale were:

  (1)    to provide quarterly cash distributions a portion of
         which will be "tax sheltered;"
  (2)    to preserve and protect capital;
  (3)    to achieve long-term appreciation in the value of the
         Properties for distributions upon sale of the Properties.

Presently, the Partnership expects to sell the Properties,
distribute the net sales proceeds and thereafter dissolve the
Partnership.

(d)  Employees

The Partnership has no employees.

(e)  Competition

The Partnership's properties compete with a variety of retirement
living complexes within their primary geographic markets,
including continuing care and lifecare facilities, which offer
higher levels of personal care, and often skilled nursing, in
addition to independent living units.  However, continuing care
and lifecare facilities usually require up-front accommodation
fees, and place greater emphasis on health and well-being rather
than on independent lifestyle and community activities.  In order
to raise visibility of the Properties and attract potential
tenants, the operator, Leisure Care, Inc., (the "Operator")
emphasizes strong community-oriented programs to build a strong
community presence with hospital administrators, church groups
and civic groups.

(f)  Property Management

The Operator is among the leading retirement center management
companies in size, experience and profit history.  The Operator
supervises the day-to-day management of the Properties, including
employing the operating personnel on behalf of the Partnership,
according to a property management agreement (the "Property
Management Agreement") and acts as the non-exclusive leasing
agent for all four Properties.  An extension to the Property
Management Agreement, which expired on December 31, 1993, was
executed and can be terminated by either party upon sixty days
notice.  Certain terms of the Property Management Agreement have
been modified as set forth in the extension.  On June 30, 1996,
the extension of the original Property Management Agreement
expired and a new extension was executed between the General
Partner and the Operator which is effective through July 1, 1997.
All of the terms and conditions of the original extension of the
Management Agreement shall remain in full force and effect
through the new expiration date.  See Note 5, "Property
Management," to the Consolidated Financial Statements of the
Partnership's Annual Report to Unitholders for the year ended
December 31, 1996 included in Item 14 of this report.


Item 2.  Properties

Ocean House
Ocean House is a ten-story property adjacent to Santa Monica
Beach in Santa Monica, California.  Many of the property's 121
units feature balconies and ocean views.  Ocean House provides
residents with various amenities including an assisted living
program.  The property is located in an upscale area with an
established senior population and faces competition from three
other retirement facilities within its market.  The property
competes at the higher end of the price scale based on its
location and level of service.  The property enjoys a competitive
advantage due to its assisted living program, many activity
programs and community involvement.

Prell Gardens
Prell Gardens is a two-story, 102-unit retirement facility
surrounding a courtyard and garden located in Van Nuys,
California.  Daily meals, maid service, a beauty salon and
transportation services are some of the many amenities available
at the property.  Prell Gardens enjoys a strong reputation within
the San Fernando Valley, and competes with two facilities
offering similar services.  The property competes in the higher
end of the market as a result of aggressive marketing efforts and
strong ties to the local community.

Pacific Inn
Pacific Inn is a three-story retirement facility located in an
affluent section of Torrance, California.  The property has 134
units with private balconies or patios, and features services and
amenities including a visiting doctor, beauty salon, dining
services and daily maid service.  Pacific Inn competes with three
older retirement facilities in its primary location.  The
facility's reputation has enabled the property to charge premium
rents and maintain a strong profit margin.

Nohl Ranch Inn
Nohl Ranch Inn, located in Anaheim Hills, California, an upscale
community, is a three-story, 133-unit facility featuring an
interior courtyard and landscaped grounds.  Nohl Ranch is
affordably priced for its market and engages in an extensive
community outreach program to enhance the property's visibility
and referral network.  The property includes such features as a
beauty salon, daily meal and maid service.  The assisted living
program, which provides assistance for residents who require help
with their daily routines, has been very successful in growing
the property's tenant base.  The property's competitor, which is
located across the street from Nohl Ranch, currently offers an
assisted living program.

Sale of Properties
The Partnership is marketing the Properties for sale and expects
to sell the Properties in 1997.  The General Partner has received
numerous bids and serious expressions of interest from
unaffiliated third party buyers.  The Partnership is in the
process of analyzing the bids it received.  Should a transaction
be consummated, one or more cash distributions of the net sale
proceeds together with any remaining cash on hand will be made to
all Unitholders as soon as practicable.  However, there can be no
assurance that any transaction will be consummated or as to the
price thereof.

1994 Earthquake
As a result of an earthquake that struck the greater Los Angeles
area on January 17, 1994, damages were sustained at two of the
Properties, Ocean House and Prell Gardens.  Additional
information is incorporated by reference to Item 7. "Management's
Discussion and Analysis of Financial Condition and Results of
Operations," and Note 11, "Earthquake Loss and Insurance
Settlement" to the Consolidated Financial Statements of the
Partnership's Annual Report to Unitholders for the year ended
December 31, 1996 included in Item 14 of this report.

Government Regulations
Two of the properties, Ocean House and Nohl Ranch, maintain
assisted living programs which require licensing.  Accordingly,
these properties are subject to the periodic licensing
requirements and inspection procedures of the California State
Department of Social Services.  California law prescribes a list
of services which must be provided in rental retirement
facilities such as:  (i) assistance with daily living activities
in the combinations which meet the needs of residents, (ii)
helping residents gain access to appropriate supportive services
in the community, (iii) being aware of the residents' general
whereabouts, (iv) monitoring the activities of the residents
while they are under the supervision of the facility to ensure
their general health, safety, well being, and (v) encouraging the
residents to maintain and develop their maximum functional
ability through participation in planned activities.  Both
criminal and civil penalties may be imposed in the event of
violation of any of these duties.  Currently there are no
restrictions on the level of rents, nor on rent increases.
Neither Prell Gardens nor Pacific Inn are currently subject to
the foregoing requirements.


Item 3.  Legal Proceedings

On September 15, 1995, litigation was initiated by the
Partnership in Los Angeles Superior Court against the
Partnership's insurance carrier and insurance broker as a result
of the insurance company's preliminary indication that it would
not reimburse the Partnership for property damage related to
earthquake damage sustained at two of the Partnership's
properties, Ocean House and Prell Gardens, in January of 1994.
On November 19, 1996, the Partnership and General Partner
executed a Mutual Release and Settlement Agreement (the
"Settlement Agreement") with the insurance carrier, whereby the
Partnership agreed to release the insurance carrier from all
claims pending under the lawsuit and to assign its remaining
claims against the insurance broker to the insurance carrier.
The Partnership received $3,200,000, from the insurance carrier
pursuant to the Settlement Agreement.  Costs associated with the
litigation which include legal, expert witness and engineering
fees were offset against the $3,200,000, resulting in net
insurance settlement income of approximately $2,318,387.
Additional information is incorporated by reference to Item 7.
"Management's Discussion and Analysis of Financial Condition and
Results of Operations," and Note 11, "Earthquake Loss and
Insurance Settlement" to the Consolidated Financial Statements of
the Partnership's Annual Report to Unitholders for the year ended
December 31, 1996 included in Item 14 of this report.

Item 4.  Submission of Matters to a Vote of Security Holders

No matters were submitted to a vote of the holders of Units
("Limited Partners") during the fourth quarter of the year for
which this report is filed.


                             PART II

Item 5.  Market for the Partnership's Limited Partnership
Interests and Related Security Holder Matters

(a) Market Price Information

There is no established trading market for the units nor is there
anticipated to be.

(b) Holders

As of December 31, 1996, there were 3,760 Limited Partners of
record.

(c)  Cash Distributions per Unit (1)
                                         1996      1995
          1st Quarter                   0.075     0.075
          2nd Quarter                   0.075     0.075
          3rd Quarter                   0.075     0.075
          Special Distribution(2)       0.600       --
          4th Quarter                   0.075     0.075

          Total                        $0.900    $0.300

 (1) The amount and timing of distribution payments is reviewed
     on a quarterly basis.  Distributions are paid approximately
     forty-five days following the period for which they are
     declared.
 
 (2) Distribution from cash reserves held pending a settlement
     with the Partnership's insurance carrier regarding certain
     claims for earthquake damage at Prell Gardens and Ocean
     House.


Item 6.  Selected Financial Data

(Dollars in thousands,
except per Unit data)           1996       1995       1994      1993      1992
Rental Income                $10,782    $10,838    $10,387    $9,526    $9,120
Interest Income                  205        199         98        36        15
Total Income                  13,305(2)  11,037     10,485     9,561     9,135
Net Income (Loss)              3,154     (7,877)(3)    137       518      (44)
Net Income (Loss) Per Unit (1)   .65      (1.63)       .03       .11     (.01)
Cash Distributions Per Unit      .90        .30        .30       .30       .13
Total Assets                 $22,574    $22,976    $32,459   $33,465   $34,033

 (1)Total Units outstanding 4,827,500.

 (2)Includes net insurance settlement income of $2,318,387, in
     connection with the Partnership's settlement of its
     litigation with its insurance carrier in November 1996.
 
 (3)Includes the recognition of a $8,712,292 loss on the write-
     down of real estate assets in compliance with Financial
     Accounting Standards No. 121 in 1995.
 

Item 7.  Management's Discussion and Analysis of Financial
Condition and Results of Operations

(a)  Liquidity and Capital Resources

The Partnership is marketing the Properties for sale and expects
to sell the Properties in 1997.  The General Partner has received
numerous bids and serious expressions of interest from
unaffiliated third party buyers.  The Partnership is in the
process of analyzing the bids it has received.  As a result of
the pending sale, the Properties were reclassified on the
consolidated balance sheet as of December 31, 1996, as Real
estate assets held for disposition.  However, there can be no
assurance that any transaction will be consummated or as to the
price thereof.

As a result of the Northridge earthquake that struck the greater
Los Angeles area on January 17, 1994, damage was sustained at two
of the Properties, Ocean House and Prell Gardens.  The General
Partner pursued reimbursement from the insurance carrier for the
repair costs, less the deductible, under the Partnership's
insurance policy.  However, the insurance carrier refused to
cover the cost to bring the buildings into compliance with
building codes enacted after the Northridge Earthquake.  The
insurance carrier also disputed the amount of damage the
buildings sustained.  As a result, on September 15, 1995, the
General Partner initiated litigation against the insurance
carrier and insurance broker.  On November 19, 1996, the
Partnership and General Partner, executed a Mutual Release and
Settlement Agreement (the "Settlement Agreement") with the
insurance carrier, whereby the Partnership agreed to release the
insurance carrier from all claims pending under the lawsuit and
to assign its remaining claim against the insurance broker to the
insurance carrier.  The Partnership received $3,200,000 from the
insurance carrier pursuant to the Settlement Agreement.  Costs
associated with the litigation which include legal, expert
witness and engineering fees were offset against the $3,200,000,
resulting in net insurance settlement income of approximately
$2,318,387.  Additional information is incorporated by reference
to Note 11, "Earthquake Loss and Insurance Settlement" to the
Consolidated Financial Statements of the Partnership's Annual
Report to Unitholders for the year ended December 31, 1996
included in Item 14 of this report.

The Partnership paid a distribution in the amount of $0.60 per
Unit on December 9, 1996 to Limited Partners of record as of
December 3, 1996.  The distribution represented the portion of
its cash reserves that the Partnership had been retaining to
cover necessary repairs pending the outcome of the litigation.

In light of the Partnership's sales efforts, it is anticipated
that the Partnership will sell all of its properties prior to
completion of the repair work at Prell Gardens and prior to
beginning work at Ocean House.  As such, the Partnership
anticipates selling Prell Gardens and Ocean House on an "as is"
and "where is" basis.

The General Partner declared a cash distribution of $.075 per
Unit for the quarter ended December 31, 1996, which was paid to
the Limited Partners on February 12, 1997.  Since inception,
limited partners have received cash distributions totaling $5.41
per original $10.00 Unit. Until the sale of the Properties is
complete, the level of future distributions will be determined on
a quarterly basis and will be based on cash flow from operations,
tempered by the Partnership's capital needs, including those
necessitated by the earthquake related repairs.  Should a sale of
the Properties be consummated, one or more cash distributions of
the net sale proceeds together with any remaining cash on hand
will be made to all Unitholders as soon as practicable.

Prepaid expenses were $168,259 and $136,282 at December 31, 1996
and 1995, respectively.  The increase is mainly due to a refund
received for workman's compensation insurance in 1996.

At December 31, 1996 accounts payable and accrued expenses were
$1,033,316 compared to $250,413 at year-end 1995.  The increase
is primarily due to higher expenses related to services rendered
by the Partnership's engineering firm in connection with
earthquake related repair work at Ocean House and Prell Gardens
in the amount of approximately $428,154, higher legal expenses
associated with the insurance litigation and various tender
offers in the amount of approximately $344,822, as well as the
timing of payments for incentive management fees payable to
Leisure Care, Inc. in 1996.

On November 21, 1996, the Partnership purchased the general
partnership interest of the successor to AFP-II for a purchase
price of $850,000.  The Partnership's purchase of the general
partnership interest was funded from cash reserves.  As a result
of such purchase, the Property Partnership will be dissolved and
all of its assets will be distributed to the Partnership.
Accordingly, all sale proceeds received upon a sale of any
property will belong to the Partnership and no amount will be
owed to AFP-II.

On November 8, 1996, an unaffiliated third party, LAVRA, Inc., a
Delaware corporation ("LAVRA"), a wholly-owned subsidiary of ARV
Assisted Living, Inc., a California Corporation, commenced a
tender offer to purchase up to 2,207,550 Units (42% of the total
outstanding Units) at a price of $5.00, net of any distributions
paid to limited partners after the date of the offer and until
its expiration.  This tender offer was subsequently modified
several times and ultimately changed to purchase all of the
outstanding Units at a net cash price of $5.90 per Unit.  On
January 31, 1997, the tender offer as modified, expired with
LAVRA accepting for purchase 607,844 and one half Units, or
approximately 12.6% of the outstanding Units.

On February 20, 1996, based upon, among other things, the advice
of legal counsel, the General Partner adopted a resolution that
states, among other things, if a Change of Control (as defined
below) occurs, the General Partner may distribute the
Partnership's cash balances not required for its ordinary
day-to-day operations.  "Change of Control" means any purchase or
offer to purchase more than 10% of the Units that is not approved
in advance by the General Partner.  In determining the amount of
the distribution, the General Partner may take into account all
material factors.  In addition, the Partnership will not be
obligated to make any distribution to any partner and no partner
will be entitled to receive any distribution until the General
Partner has declared the distribution and established a record
date and distribution date for the distribution.

(b)  Results of Operations

1996 versus 1995

Partnership operations for the year ended December 31, 1996
resulted in net income of $3,154,499 compared to a net loss of
$7,877,298 for 1995.  The change from net loss to net income in
1996 is the result of the Partnership's net insurance settlement
income of $2,318,387 in 1996 and the recognition of a $8,712,292
loss on the write-down of real estate assets in compliance with
Financial Accounting Standards No. 121 in 1995.

Rental income was $10,782,123 for the year ended December 31,
1996, compared to $10,838,267 for 1995.  The decrease is the
result of lower average occupancy at Prell Gardens as anticipated
during the earthquake repair work at the property.  The decrease
in rental income at Prell Gardens was partially offset by higher
rental income from each of the other properties, notably Nohl
Ranch and Pacific Inn.  Interest income for the year was
$204,526, largely unchanged from $199,078 in 1995.

Total expenses for the year ended December 31, 1996 were
$10,150,537, compared to $18,914,643 for the year ended December
31, 1995.  The decrease is largely the result of the
Partnership's recognition of a $8,712,292, loss on the write-down
of Prell Gardens, Ocean House and Nohl Ranch, in compliance with
Financial Accounting Standards No. 121, in 1995.  Depreciation
was $1,507,326 for the year ended December 31, 1996 compared to
$1,797,858 for the year ended December 31, 1995.  The decrease
reflects the adjusted basis of the properties required at year-
end 1995 in connection with the write-down of the properties.

General and administrative expenses were $1,774,183 in 1996,
compared to $1,633,797 in 1995.  The increase is the result of
legal, printing and postage expenses incurred in connection with
various tender offers, the AFP-II buyout, and other legal fees.

For the years ended December 31, 1996, 1995 and 1994, the average
occupancy levels for the properties were as follows:

               Property           1996      1995      1994
               Ocean House         91%       92%       95%
               Pacific Inn         98%       97%       94%
               Prell Gardens       72%       93%       97%
               Nohl Ranch          98%       95%       83%
               Average Occupancy   91%       94%       92%


1995 versus 1994

Partnership operations generated a net loss of $7,877,298 for the
year ended December 31, 1995, compared to net income of $137,035.
The change from net income to net loss was primarily attributable
to a $8,712,292 loss recognized on the write down of Prell
Gardens, Ocean House and Nohl Ranch, implemented in compliance
with Financial Accounting Standards No. 121, a new accounting
standard which was issued in March 1995.  This was partially
offset by a provision for earthquake loss in 1994 of $750,000
related to the earthquake repairs at Ocean House and Prell
Gardens in the amounts of $500,000 and $250,000, respectively,
and higher total income in 1995.

Rental revenue for the year ended December 31, 1995 was
$10,838,267, compared with $10,386,764 in 1994.  The 4.3%
increase was mainly the result of higher occupancy at Nohl Ranch
and Pacific Inn.  For the year ended December 31, 1995 interest
income was $199,078, compared with $97,928 in 1994.  The increase
reflected higher average cash balances maintained in 1995.

For the year ended December 31, 1995, total expenses were
$18,914,643, compared with $10,347,657 in 1994.  Total expenses
increased in 1995 as a result of the above mentioned write-down
of real estate in 1995.  Total expenses in 1994 included a
provision for earthquake loss in the amount of $750,000, the
Partnership's deductible under its insurance policy.  General and
administrative expenses for the year ended December 31, 1995 were
$1,633,797, compared with $1,427,356 in 1994.  The increase was
primarily a result of higher insurance costs and higher
management incentive fees at all four of the Partnership's
properties.  For the year ended December 31, 1995, repairs and
maintenance expense was $616,998, compared with $490,095 in 1994.
The increase was mainly the result of property improvements
completed in 1995.  Supplies expenses were $1,122,448, and
$1,020,782, respectively, for the years ended December 31, 1995
and 1994.  The increase in 1995 was primarily attributable to
higher costs associated with the food services department as a
result of increased average occupancy in 1995.

Item 8.  Financial Statements and Supplementary Data

Incorporated by reference to the Partnership's Annual Report to
Unitholders for the year ended December 31, 1996, which is filed
as an exhibit under Item 14.

Item 9.  Changes in and Disagreements with Accountants on
Accounting and Financial Disclosure

None.


                            PART III


Item 10.  Directors and Executive Officers of the Partnership

The Partnership has no directors or officers.  The General
Partner has general responsibility for all aspects of the
Partnership's operation.  Certain of the officers and directors
of the General Partner are also officers and employees of Lehman
Brothers Inc.

Certain officers and directors of the General Partner are now
serving (or in the past have served) as officers or directors of
entities which act as general partners of a number of limited
partnerships which have sought protection under the provisions of
the Federal Bankruptcy Code.  The partnerships which have filed
bankruptcy petitions own assets which have been adversely
affected by the economic conditions in the markets in which that
asset is located and, consequently, the partnerships sought
protection of the bankruptcy laws to protect the partnerships'
assets from loss through foreclosure.

The directors and principal officers of the General Partner are
listed below.

        Name               Office
        Moshe Braver       Director and President
        Sean F. Donahue    Vice President, Chief Financial Officer and Director
        Lawrence M. Ostow  Vice President

Moshe Braver, 43, is currently a Managing Director of Lehman
Brothers and has held such position since October 1985.  During
this time, he has held positions with the Business Analysis
Group, International and Capital Markets Administration and
currently, with the Diversified Asset Group.  Mr. Braver joined
Shearson Lehman Brothers in August 1983 as Senior Vice President.
Prior to joining Shearson, Mr. Braver was employed by the
accounting firm of Coopers & Lybrand from January 1975 through
August 1983 as an Audit Manager.  He received a Bachelor of
Business Administration degree from Bernard Baruch College in
January 1975 and is a Certified Public Accountant.

Sean F. Donahue, 34, is currently a Vice President of Lehman
Brothers in the Diversified Asset Group.  Mr. Donahue joined
Lehman in April 1986 as an Assistant Vice President with the
Realty Finance Group.  Mr. Donahue has been actively involved in
real estate investment, management, marketing and workouts.  From
December 1985 to April 1986, Mr. Donahue was Assistant Treasurer
of The Patrician Group and was actively involved with the
company's banking relationships and real estate acquisitions.
Prior to that, Mr. Donahue was employed by Peat Marwick Mitchell
& Co. as a consultant in the firm's Real Estate Practice Group.
Mr. Donahue received a B.B.A. degree from Pace University in
1983.

Lawrence M. Ostow, 29, is a Vice President of Lehman Brothers and
is responsible for the management of commercial real estate in
the Diversified Asset Group.  Mr. Ostow joined Lehman Brothers in
September 1992.  Prior to that, Mr. Ostow was a Senior Consultant
with Arthur Andersen & Co. in the Real Estate Services Group,
beginning in July 1990.  Mr. Ostow is a candidate for an M.B.A.
from the Stern School of Business in 1997 and earned a B.A.
degree in Economics from the University of Michigan in 1990.

Item 11.  Executive Compensation

The Directors and Officers of the General Partner do not receive
any salaries or other compensation from the Partnership.  See
Item 13, "Certain Relationships and Related Transactions," for a
description of certain transactions of the General Partner and
its affiliates with the Partnership.

Item 12.  Security Ownership of Certain Beneficial Owners and
Management

(a)  Security ownership of certain beneficial owners.

According to the records of the Partnership's transfer agent, at
December 31, 1996, no investor held more than 5% of the
outstanding Units.  However, LAVRA's schedule 14D-1 filed on
December 23, 1996, states that LAVRA is the beneficial owner of
424,272.5 units or approximately 8.8% of the Partnership's
outstanding units.

                     Name and address of     Amount and Nature of      Percent
Title of Class        Beneficial Owner       Beneficial Ownership      of Class
-------------------------------------------------------------------------------
Units of Limited      LAVRA, Inc.            424,272.5 Units owned       8.8%
Partnership Interest  245 Fischer Avenue,    beneficially and of record
                      Suite D-1
                      Costa Mesa, CA  92626

(b)  Security ownership of management.

Officers and Directors of the General Partner owned no units of
the Partnership as of December 31, 1996.

(c)  Changes in control.

None.


Item 13.  Certain Relationships and Related Transactions

For fees paid and reimbursed to the General Partner or its
affiliates during 1996, 1995 and 1994, see Note 6, "Transactions
with Related Parties," to the Consolidated Financial Statements
in Item 8, "Financial Statements and Supplementary Data," which
is incorporated by reference to the Partnership's Annual Report
to Unitholders for the year ended December 31, 1996, which is
filed as an exhibit under Item 14.


                             PART IV


Item 14.  Exhibits, Financial Statement Schedules and Reports on
Form 8-K

(a)(1) Financial Statements:
     
     Consolidated Balance Sheets - At December 31, 1996 and 1995   (1)
     
     Consolidated Statements of Partners' Capital (Deficit)  -
     For the years ended December 31, 1996, 1995 and 1994          (1)
     
     Consolidated Statements of Operations - For the years ended
     December 31, 1996, 1995 and 1994                              (1)
     
     Consolidated Statements of Cash Flows - For the years ended
     December 31, 1996, 1995 and 1994                              (1)
     
     Notes to the Consolidated Financial Statements                (1)
     
     Report of Independent Accountants                             (1)
     
(a)(2) Financial Statement Schedules:

     Schedule III - Real Estate and Accumulated Depreciation     (F-1)

     Report of Independent Accountants                           (F-2)

(1) Incorporated by reference to the Partnership's Annual Report
 to Unitholders for the year ended December 31, 1996, filed as
 an exhibit under Item 14.

(b) Reports on Form 8-K:

     An 8-K was filed on December 4, 1996, disclosing information
     about the Partnership's purchase of the general partnership
     interest in Shearson August Property Partnership, the legal
     settlement with the Partnership's insurance carrier, and an
     amendment to a tender offer commenced by LAVRA Inc. to
     purchase up to 51% of the outstanding Units.

(c) Exhibits

3.1  The Partnership's Amended and Restated Agreement of Limited
     Partnership, Dated March 17, 1987, is hereby incorporated by
     reference to Exhibit A to the Prospectus contained in
     Registration Statement No. 33-9921, which registration
     Statement (the "Registration Statement") was declared
     effective by the Securities and Exchange Commission on
     January 30, 1987.

3.2  The Capital Contribution Agreement by and among the General
     Partner and Shearson Group is hereby incorporated by
     reference to Exhibit 3.2 to the Registration Statement.

10.1 Form of the Management Agreement dated as of April 5, 1988
     between the Partnership and the Operator is incorporated by
     reference to Exhibit 10.2 to the Registration Statement.

10.2 The form of Property Partnership Agreement between the
     Partnership and the Property Partner is hereby incorporated
     by reference to Exhibit 10.6 to the Registration Statement.

10.3 The form of Purchase Agreement concerning the acquisition of
     the Properties is hereby incorporated by reference to
     Exhibit No. 10.4 to the Registration Statement.

10.4 Form of the Amended Management Agreement dated as of January
     1, 1990 between the Partnership and the Operator hereby
     incorporated by reference to Exhibit 10.5 to the
     Partnership's Annual Report on Form 10-K for the year ended
     December 31, 1989, as filed with the Securities and Exchange
     Commission on March 30, 1990.

10.5 Form of the Settlement Agreement Dated December 18, 1989
     between the Partnership and class members hereby
     incorporated by reference to Exhibit 10.6 to the
     Partnership's Annual Report on Form 10-K for the year ended
     December 31, 1989, as filed with the Securities and Exchange
     Commission on March 30, 1990.

13.1 Annual Report to Unitholders for the year ended December 31, 1996.

27   Financial Data Schedule.


                           SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of  the
Securities and Exchange Act of 1934, the Partnership has duly
caused this report to be signed on its behalf by the undersigned,
thereunto duly authorized.


                    SENIOR INCOME FUND L.P.

                    BY:  SENIOR INCOME FUND INC.
                         General Partner



Date:  March 27, 1997    BY:  /s/ Moshe Braver
                       Name:  Moshe Braver
                      Title:  Director and President


Pursuant to the requirements of the Securities and Exchange Act
of 1934, the Partnership has duly caused this report to be signed
on its behalf by the undersigned, thereunto duly authorized.



                    SENIOR INCOME FUND L.P.

                    BY:  SENIOR INCOME FUND INC.
                         General Partner



Date:  March 27, 1997    BY:  /s/ Moshe Braver
                       Name:  Moshe Braver
                      Title:  Director and President



Date:  March 27, 1997    BY:  /s/ Sean Donahue
                       Name:  Sean Donahue
                      Title:  Vice President, Chief Financial
                              Officer and Director



Date:  March 27, 1997    BY:  /s/ Lawrence M. Ostow
                       Name:  Lawrence M. Ostow
                      Title:  Vice President