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


                            FORM 8-K


                         CURRENT REPORT
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934


  Date of Report (Date of earliest event reported)  January 26, 2006


            AEI REAL ESTATE FUND XVIII LIMITED PARTNERSHIP
        (Exact name of registrant as specified in its charter)


      State of Minnesota          0-18289          41-1622463
(State or other jurisdiction (Commission File     (IRS Employer
      of incorporation)            Number)      Identification No.)


      30 East 7th Street, Suite 1300, St. Paul, Minnesota, 55101
             (Address of Principal Executive Offices)


                            (651) 227-7333
       (Registrant's telephone number, including area code)


  (Former name or former address, if changed since last report)

Check  the  appropriate  box below if  the  Form  8-K  filing  is
intended to simultaneously satisfy the filing obligation  of  the
registrant under any of the following provisions:

[  ]  Written  communication  pursuant  to  Rule  425  under  the
      Securities Act (17 CFR 230.425)
[  ]  Soliciting  material  pursuant to  Rule  14a-12  under  the
      Exchange Act (17 CFR 240.14a-12)
[  ]  Pre-commencement communications pursuant to  Rule  14d-2(b)
      under the Exchange Act
      (17 CFR 240.14d-2(b))
[  ]  Pre-commencement communications pursuant to  Rule  13e-4(c)
      under the Exchange Act
      (17 CFR 240.13e-4(c))

Section 2 - Financial Information

Item 2.01 Completion of Acquisition or Disposition of Assets.

       On  January  26, 2006, the Partnership sold a Taco  Cabana
restaurant  in San Antonio, Texas to the lessee.  The Partnership
received  net cash proceeds of approximately $1,640,000  for  the
property, which resulted in a net gain of approximately $482,000.

Section 9 - Financial Statements and Exhibits

Item 9.01 Financial Statements and Exhibits.

      (a) Financial statements  of  businesses  acquired  -   Not
          Applicable.

      (b) Pro  forma financial information - A limited number  of
          pro  forma  adjustments are required to illustrate  the
          effects  of  the transaction on the balance  sheet  and
          income  statement.  The following narrative description
          is  furnished  in  lieu  of the pro  forma  statements.
          Assuming  the  Partnership had  sold  the  property  on
          January 1, 2004:

          The Partnership's Investments in Real Estate would have
          been  reduced  by  $1,157,654 and  its  Current  Assets
          (cash) would have increased by $1,640,000 and Partner's
          Capital would have increased by $482,346.

          For  the  year  ended December 31,  2004,  Income  from
          Discontinued Operations would have decreased  $244,233,
          representing  a decrease in rental income  of  $244,514
          and a decrease in property management expenses of $281.
          For  the  nine months ended September 30, 2005,  Income
          from   Discontinued  Operations  would  have  decreased
          $189,500,  representing a decrease in rental income  of
          $189,804 and a decrease in property management expenses
          of $304.

          The  net  effect  of these pro forma adjustments  would
          have  caused Net Income to decrease from $2,436,839  to
          $2,192,606  and  from $1,511,354 to  $1,321,854,  which
          would have resulted in Net Income of $111.90 and $68.14
          per  Limited Partnership Unit outstanding for the  year
          ended  December  31,  2004 and the  nine  months  ended
          September 30, 2005, respectively.

      (c) Exhibits.

          Exhibit 10.1  - Purchase Agreement dated May  21,  2003
          between  the  Partnership and  Texas  Taco  Cabana,  LP
          relating to the Property at 7339 San Pedro Avenue,  San
          Antonio,  Texas (incorporated by reference  to  Exhibit
          10.1 of Form 10-QSB filed August 8, 2003).

          Exhibit 10.2  - Fourth Amendment to Purchase  Agreement
          dated  February  17, 2004 between the  Partnership  and
          Texas Taco Cabana, LP relating to the Property at  7339
          San Pedro Avenue, San Antonio, Texas.

          Exhibit 10.3 - Twelfth Amendment to Purchase  Agreement
          dated  December  16, 2005 between the  Partnership  and
          Texas Taco Cabana, LP relating to the Property at  7339
          San Pedro Avenue, San Antonio, Texas.



                           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 hereunto duly authorized.

                              AEI REAL ESTATE FUND XVIII LIMITED
                              PARTNERSHIP

                              By: AEI Fund Management XVIII, Inc.
                                 Its:  Managing General Partner


Date:  January 27, 2006            /s/ Patrick W Keene
                              By:      Patrick W. Keene
                                 Its:  Chief Financial Officer