SECURITIES AND EXCHANGE COMMISSION

                          WASHINGTON, D.C.  02549



                                 FORM 8-K

                  PURSUANT TO SECTION 13 OR 15(D) OF THE
                      SECURITIES EXCHANGE ACT OF 1934


   Date of Report (Date of earliest event reported):  March 17, 1998


                        AMBASSADOR APARTMENTS, INC.
          (Exact name of registrant as specified in its charter)


   Maryland                            1-14132           36-3948161
   (State or other jurisdiction  (Commission File      (IRS Employer
   of incorporation)              Number)            Identification No.)



   77 West Wacker Drive, Suite 4040, Chicago, Illinois        60601
   (Address of principal executive offices)                 (Zip Code)


   (312) 917-1600
   (Registrant's Telephone Number)





   Item 5 Other Events

         On March 17, 1998, Ambassador Apartments, Inc. (the "Company")
   and Apartment Investment and Management Company (the "Purchaser")
   entered into a letter agreement (the "Letter Agreement")
   supplementing the Agreement and Plan of Merger dated as of December
   23, 1997 (the "Merger Agreement") between the Company and the
   Purchaser.

         The Letter Agreement is attached as Exhibit 1 hereto and is
   incorporated herein by reference.


   Item 7. Exhibits

   1.    Letter Agreement dated as of March 11, 1998 between Ambassador
         Apartments, Inc. and Apartment Investment and Management
         Company. 
 


                                 SIGNATURE

         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 thereunto duly authorized.

                                             AMBASSADOR APARTMENTS, INC.
                                             Registrant


   Dated:  March 17, 1998                    /s/ Thomas J. Coorsh
                                                 Thomas J. Coorsh
                                                 Senior Vice President
                                                 and Chief Financial
                                                 Officer





                                 EXHIBIT 1

                        AMBASSADOR APARTMENTS, INC.
                           77 West Wacker Drive
                             Chicago, IL 60601

                              March 11, 1998

   Apartment Investment and Management Company
   1873 South Bellaire Street, 17th Floor
   Denver, CO 80222

   Gentlemen:

         This letter  agreement is entered into in  connection with that
   certain Agreement and Plan of Merger ("Merger Agreement") dated as of
   December 23, 1997 between Apartment Investment and Management Company
   ("AIMCO") and Ambassador Apartments, Inc. ("Ambassador").   Reference
   is made to the Merger Agreement. Terms  used in this letter that  are
   defined terms  in the Merger  Agreement but which are  not defined in
   this letter will  have the same  meaning as in the  Merger Agreement.
   To clarify the Merger Agreement,  and notwithstanding anything to the
   contrary contained  in the  Merger Agreement,  the parties  agree  as
   follows:

         1.    Dividends.  In  lieu   of  the  payment  of  the  special
   dividends contemplated by Section 2.2(c)(i) of the Merger Agreement:

         (a)   Regular  Quarterly Dividends.    Consistent  with Section
   7.15 of  the Merger Agreement,  each party will  declare its  regular
   quarterly dividend for the first quarter (and for any other  calendar
   quarter ended prior to  the Effective Time) with  a record date prior
   to  the  Effective Time.   In  addition,  in the  ordinary  course of
   business after the Effective Time, AIMCO will declare a dividend  for
   the quarter in  which the Effective Time occurs  in the amount of its
   regularly quarterly dividend amount for such quarter.

         (b)   Special Ambassador Dividend. Ambassador will also declare
   a special dividend, with a record date  prior to the Effective  Time,
   which will result  in its stockholders receiving an amount  per share
   equal to the  product of (x) the difference between  (a) Ambassador's
   most recent quarterly dividend amount (appropriately adjusted for any
   stock splits and  the like)  and (b)  the product  of the  Conversion
   Ratio (as  determined pursuant to  the Merger  Agreement) and AIMCO's
   most recent quarterly dividend amount (appropriately adjusted for any
   stock  splits and the like), and  (y) the number of  days which shall
   have elapsed through  and including the day immediately prior  to the
   day of the Effective  Time since the end of the most  recent calendar
   quarter (as of  the Effective Time)  for which  Ambassador's dividend
   record date  has occurred divided by  91. Thus,  for example, if  the
   Effective  Time occurs  on May  1, 1998, in  addition to  the regular
   dividends   provided   for  in   paragraph   (a)   above,  Ambassador
   stockholders would  receive a  special dividend  of $.0238  per share
   (assuming the Conversion Ratio is 0.583). 
 



         (c)   Miscellaneous. This  Section 1 shall not  be construed to
   limit Ambassador's rights to take actions necessary or appropriate in
   complying  with tax  laws relating  to  REITs.   In addition,  to the
   extent  necessary  or   appropriate  under  such  tax  laws,  regular
   Ambassador dividends  contemplated hereby will be  paid by Ambassador
   and  received by  its stockholders  prior to  the Effective  Time. If
   payment of any Ambassador dividends provided for in this Section 1 is
   not  made prior to  the Effective Time, then,  promptly following the
   Effective Time the Surviving Corporation shall  pay such dividends to
   the  holders entitled  thereto.  Concurrent and  equivalent  per unit
   distributions for the benefit of holders of OP Units shall be made in
   connection  with the  dividends  contemplated  by this  letter.   The
   parties shall  cooperate to  implement the  dividend and distribution
   provisions  of  the  Merger Agreement  and  this  letter  as  may  be
   necessary  to achieve  the intended economic benefits  thereof to the
   shareholders of the parties.  

         2.    AIMCO  Break-Up Expenses.    If the  Merger  Agreement is
   terminated  by AIMCO  pursuant  to Section  9.1(b)(i),  then, without
   limitation of  AIMCO's right, if  any, to receive  the Break-Up  Fee,
   Ambassador shall pay  to AIMCO the Break-Up Expenses (subject  to the
   limitations contained in  the Merger  Agreement with  respect to  the
   payment of such Break-Up Expenses).

         3.    Ambassador Break-Up Expenses.  If the Merger Agreement is
   terminated by Ambassador pursuant to Section 9.1(b)(i), then, without
   limitation  of Ambassador's right,  if any,  to receive  the Break-Up
   Fee, AIMCO shall pay to Ambassador the Break-Up Expenses (subject  to
   the limitations contained in the Merger Agreement with respect to the
   payment of such Break-Up Expenses).





         Please indicate your  agreement with the foregoing by executing
   this letter in the space provided below.

                                       AMBASSADOR APARTMENTS, INC.


                                       By:/s/ DEBRA A. CAFARO
                                          Name:    Debra A. Cafaro
                                          Title:   President
   Agreed to and accepted:

   APARTMENT INVESTMENT AND
   MANAGEMENT COMPANY

   By: /s/ THOMAS W. TOOMEY
       Name: Thomas W. Toomey
       Title: Executive Vice President