October 31, 1996

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


DEAR LIMITED PARTNERS:

We are pleased to enclose the Partnership's unaudited financial statements 
for the period ended September 30, 1996.  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 September 30, 1996 and 1995, total revenues 
increased 7.5% from $447,045 to $480,654 and total expenses decreased 3.8% 
from $263,964 to $254,069.  Minority interest in income of real estate joint
ventures increased $103,000. As a result, net income decreased 32.5% from 
$183,081 for the three month period ended September 30, 1995, to $123,585 
for the same period in 1996. Occupancy levels for the Partnership's four 
mini-storage facilities averaged 88.7% for the three month period ended 
September 30, 1996 as compared to 87.8% for the same period in 1995. Rental 
revenue increased as a result of higher occupancy and unit rental rates.  
The Partnership is continuing its marketing efforts to attract and keep new 
tenants in its various mini-storage facilities. Operating expenses decreased 
approximately $12,000 (5%) primarily as a result of lower maintenance and
repair, office supplies and worker's compensation insurance expenses partially
offset by an increase in real estate tax expense. General and administrative 
expenses increased approximately $2,100 (9.2%) primarily as a result of 
Michigan and Illinois partnership tax prepayments.  Minority interest in 
income of real estate joint ventures increased as a result of the Partnership
having reached the level of income in the current period where the minority
partners start participating in the distribution of said income.

For the nine month periods ended September 30, 1996, and 1995, total revenues 
increased 7.3% from  $1,283,200  to  $1,376,256 and total expenses decreased 
0.6% from $813,215 to $808,079.  Minority interest in income of real estate
joint ventures increased $103,000.  As a result, net income decreased 1% from 
$469,985 for the nine month period ended September 30, 1995, to $465,177 for
the same period in 1996.  Rental revenue increased for the same reasons as 
discussed above.  Operating expenses decreased approximately $10,700 (1.5%) 
primarily as a result of lower yellow pages advertising, maintenance and
repair, office supplies and security expenses partially offset by higher
salaries and wages, real estate tax expense and property management fees.
Property management fees, which are based on rental income, increased as a
result of the increase in rental income.  General and administrative expenses
increased approximately $5,500 (5.6%) for the same reasons as discussed
above.  The reason for the increase in minority interest in income of real
estate joint ventures is the same as discussed above.

The General Partners plan to continue their policy of funding improvements 
and maintenance of Partnership properties with cash generated from operations.
The Partnership's financial resources appear to be adequate to meet its needs.

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 XI, P.O. Box 357, Long 
Beach, California 90801. 

                              Very truly yours,

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



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