April 28, 2000

		QUARTERLY REPORT TO THE LIMITED PARTNERS
			OF DSI REALTY INCOME FUND VII


DEAR LIMITED PARTNERS:

We are pleased to enclose the  Partnership's  unaudited financial statements
for  the  period  ended  March  31,  2000.  The  following  is  Management's
discussion  and  analysis  of  the  Partnership's  financial  condition  and
results  of  its  operations.

For the  three month  periods  ended  March 31, 2000 and 1999, total revenues
decreased 1.5% from $551,732 to $543,235 and total expenses decreased 1.6%
from $398,937 to $392,444.  As a result, net income decreased 1.3% from
$152,795 for the three month period ended March 31, 1999, to $150,791 for
the same period in 2000.  Occupancy levels for the Partnership's six mini-
storage facilities averaged 80.1% for the three month period ended March 31,
2000, and 83.5% for the same period in 1999.  Rental revenue decreased
primarily as a result of lower occupancy levels.  The Partnership is continu-
ing its marketing effort to attract and keep new tenants in its various mini-
storage facilities.  Operating expenses decreased approximately $6,700 (2.0%)
primarily as a result of decreases in repairs and maintenance salary and wages
expenses, partially offset by an increase in yellow pages advertising costs.
General and administrative expenses remained relatively constant.

The General Partners will continue their  policy of  funding the  continuing
improvement and  maintenance of  Partnership  properties with cash generated
from operations.  The Partnership's financial resources appear to be adequate
to meet its needs.  The  General  Partners  anticipate  distributions to the
Limited Partners to remain at the current level for the foreseeable future.

We are not enclosing a copy of the Partnership Form 10-Q as filed with the
Securities  and  Exchange  Commission  since all the information set forth
therein is contained  either in this  letter or in the  attached  financial
statements.  However, if you wish to  receive a copy of said report, please
send a  written  request to  DSI  Realty  Income  Fund  VII,  P.O.  Box 357,
Long  Beach,  California  90801.

                              Very truly yours,

                              DSI REALTY INCOME FUND VII
                              By: DSI Properties, Inc., as
                              General Partner



                              By  /s/ Robert J. Conway
                                  ____________________________
                                  ROBERT J. CONWAY, President