UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                                   FORM 10-K/A


(Mark One)
 [x] ANNUAL REPORT PURSUANT TO SECTION 13 OR 15 (d) OF THE SECURITIES EXCHANGE
                                  ACT OF 1934

                   For the fiscal year ended December 31, 1997

                                       OR

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

                        For the transition period from to


                         Commission file number 0-26218

                            CNL INCOME FUND XVI, LTD.
             (Exact name of registrant as specified in its charter)

                     Florida                             59-3198891
         (State or other jurisdiction of    (I.R.S. Employer Identification No.)
         incorporation or organization)

                              400 East South Street
                             Orlando, Florida 32801
          (Address of principal executive offices, including zip code)

       Registrant's telephone number, including area code: (407) 422-1574

               Securities registered pursuant to Section 12(b) of
                                    the Act:

                 Title of each class:     Name of exchange on which registered:
                         None                        Not Applicable

               Securities registered pursuant to Section 12(g) of
                                    the Act:

              Units of limited partnership interest ($10 per Unit)
                                (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 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 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  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]

         Aggregate market value of the voting stock held by nonaffiliates of the
registrant:   The  registrant   registered  an  offering  of  units  of  limited
partnership  interest  (the  "Units") on Form S-11 under the  Securities  Act of
1933, as amended. Since no established market for such Units exists, there is no
market value for such Units. Each Unit was originally sold at $10 per Unit.

                      DOCUMENTS INCORPORATED BY REFERENCE:
                                      None


<PAGE>



The Form 10-K of CNL Income  Fund XVI,  Ltd.  (the  "Partnership")  for the year
ended December 31, 1997, is being amended to include, in Item 14(d),  summarized
financial  information of one of its tenants,  DenAmerica  Corp., as a result of
the fact that this tenant leased more than 20 percent of the Partnership's total
assets  for  the  year  ended  December  31,  1997.  This  summarized  financial
information  was not available to the  Partnership  at the time the  Partnership
filed its Form 10-K for the year ended December 31, 1997.


                                     PART IV


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

         (d)      Other Financial Information.

                  The following  summarized  financial  information  is filed as
                  part of this  report  as a result  of the fact that one of the
                  Partnership's  tenants,  DenAmerica Corp., leased more than 20
                  percent of the  Partnership's  total assets for the year ended
                  December  31,  1997.  The  summarized  financial   information
                  presented for DenAmerica Corp. and Subsidiaries as of December
                  31, 1997 and 1996 and the years ended December 31, 1997,  1996
                  and 1995,  was obtained from the Form 10-K filed by DenAmerica
                  Corp.  and  Subsidiaries  with  the  Securities  and  Exchange
                  Commission for the year ended December 31, 1997.


                        DenAmerica Corp. and Subsidiaries
                             Selected Financial Data
                                 (in Thousands)

Consolidated Balance Sheet Data:
                                                       December 31,
                                                 1997                 1996

Current Assets                                 $ 41,967            $ 14,382
Noncurrent Assets                               128,297             164,807
Current Liabilities                              78,384              47,411
Noncurrent Liabilities                           90,632             109,650


Consolidated Statements of
  Operations Data:
                                           Year Ended December 31,
                                     1997            1996            1995
                                  -----------    ------------    --------

Gross revenues                    $300,579         $241,480        $ 74,683
Costs and expenses (including
  income tax benefit)              321,556          239,865          74,483
                                  --------         --------        --------

Income (loss) before extra-
  ordinary item                    (20,977)           1,615             200

Extraordinary item - loss on
  extinguishment of debt
  (net of income taxes)                 -              (497)             -
                                  --------         --------        -------

Net income (loss)                  (20,977)           1,118             200

Preferred stock dividend
  accretion                             -              (149)           (593)
                                  --------         --------        --------

Net income (loss) applicable
  to common shareholders          $(20,977)        $    969        $   (393)
                                  ========         ========        ========

                                        1

<PAGE>



                                   SIGNATURES


         Pursuant to the  requirements  of Section 13 or 15(d) 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,  on the 29th day of
June, 1998.

                                            CNL INCOME FUND XVI, LTD.

                                            By:    CNL REALTY CORPORATION
                                                   General Partner

                                                   /s/ Robert A. Bourne
                                                   ----------------------------
                                                   ROBERT A. BOURNE, President


                                            By:    ROBERT A. BOURNE
                                                   General Partner

                                                   /s/ Robert A. Bourne
                                                   ----------------------------
                                                   ROBERT A. BOURNE


                                            By:    JAMES M. SENEFF, JR.
                                                   General Partner

                                                   /s/ James M. Seneff, Jr.
                                                   ---------------------------
                                                   JAMES M. SENEFF, JR.



<PAGE>


         Pursuant to the  requirements  of the Securities  Exchange Act of 1934,
this  report has been  signed  below by the  following  persons on behalf of the
Registrant and in the capacities and on the dates indicated.
<TABLE>
<CAPTION>

Signature                                    Title                                  Date
<S> <C>

/s/ Robert A. Bourne                    President, Treasurer and Director       June 29, 1998
-----------------------------           (Principal Financial and Accounting
Robert A. Bourne                        Officer)


/s/ James M. Seneff, Jr.                Chief Executive Officer and Director    June 29, 1998
-----------------------------           (Principal Executive Officer)
James M. Seneff, Jr.

</TABLE>