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  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
  
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  <P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>UNITED STATES</B></P>
  
  <P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>SECURITIES AND EXCHANGE COMMISSION</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Washington, D.C. 20549</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>FORM&nbsp;8-K</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><B>&nbsp;</B></P>
  
  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>CURRENT REPORT</B></P>
  
  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Pursuant to Section&nbsp;13 OR 15(d)&nbsp;of
  The Securities Exchange Act of 1934</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in"><B>&nbsp;</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">Date of Report (Date of earliest event
  reported)<B> August 14, 2014</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 18pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>DSI REALTY INCOME FIND VII </B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">(Exact name of registrant as specified
  in its charter)</P>
  
  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
  <TR>
      <TD STYLE="vertical-align: top; width: 31%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;California</B></FONT></TD>
      <TD STYLE="vertical-align: bottom; width: 2%">&nbsp;</TD>
      <TD STYLE="vertical-align: top; width: 33%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;&nbsp;2-83291 </B></FONT></TD>
      <TD STYLE="vertical-align: top; width: 2%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;</B></FONT></TD>
      <TD STYLE="vertical-align: top; width: 32%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;&nbsp;95-3871044</B></FONT></TD></TR>
  <TR>
      <TD STYLE="vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(State or other jurisdiction </FONT><BR>
  <FONT STYLE="font: 10pt Times New Roman, Times, Serif">of incorporation)</FONT></TD>
      <TD STYLE="vertical-align: bottom">&nbsp;</TD>
      <TD STYLE="vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Commission</FONT><BR>
  <FONT STYLE="font: 10pt Times New Roman, Times, Serif">File Number)</FONT></TD>
      <TD STYLE="vertical-align: bottom">&nbsp;</TD>
      <TD STYLE="vertical-align: top"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(I.R.S. Employer</FONT><BR>
  <FONT STYLE="font: 10pt Times New Roman, Times, Serif">Identification No.)</FONT></TD></TR>
  </TABLE>
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
  <TR>
      <TD STYLE="vertical-align: top; width: 50%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;6700 E. Pacific Coast Hwy., Long Beach, CA</B></FONT></TD>
      <TD STYLE="vertical-align: bottom; width: 1%; line-height: 115%; font-size: 11pt">&nbsp;</TD>
      <TD STYLE="vertical-align: top; width: 49%; text-align: center; line-height: 115%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif"><B>90803</B></FONT></TD></TR>
  <TR>
      <TD STYLE="vertical-align: top; text-align: center; line-height: 115%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Address of principal executive offices)</FONT></TD>
      <TD STYLE="vertical-align: bottom; line-height: 115%; font-size: 11pt">&nbsp;</TD>
      <TD STYLE="vertical-align: top; text-align: center; line-height: 115%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">(Zip Code)</FONT></TD></TR>
  </TABLE>
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">Registrant&rsquo;s telephone number,
  including area code <B>(562) 493-8881</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>Not Applicable</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">(Former name or former address, if changed
  since last report.)</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">Check the appropriate box below if the Form&nbsp;8-K filing
  is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 11pt/normal Calibri, Helvetica, Sans-Serif; margin: 0 0 0 0.25in; text-indent: -0.25in"><FONT STYLE="font: 10pt Wingdings">o</FONT><FONT STYLE="font: 3pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Written communications pursuant to Rule&nbsp;425 under the Securities
  Act (17 CFR 230.425)</FONT></P>
  
  <P STYLE="font: 10pt/normal Wingdings; margin: 0 0 0 0.25in; text-indent: -0.25in">&nbsp;</P>
  
  <P STYLE="font: 11pt/normal Calibri, Helvetica, Sans-Serif; margin: 0 0 0 0.25in; text-indent: -0.25in"><FONT STYLE="font: 10pt Wingdings">o</FONT><FONT STYLE="font: 3pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Soliciting material pursuant to Rule&nbsp;14a-12 under the Exchange
  Act (17 CFR 240.14a-12)</FONT></P>
  
  <P STYLE="font: 10pt/normal Wingdings; margin: 0 0 0 0.25in; text-indent: -0.25in">&nbsp;</P>
  
  <P STYLE="font: 11pt/normal Calibri, Helvetica, Sans-Serif; margin: 0 0 0 0.25in; text-indent: -0.25in"><FONT STYLE="font: 10pt Wingdings">o</FONT><FONT STYLE="font: 3pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pre-commencement communications pursuant to Rule&nbsp;14d-2(b)&nbsp;under
  the Exchange Act (17 CFR 240.14d-2(b))</FONT></P>
  
  <P STYLE="font: 10pt/normal Wingdings; margin: 0 0 0 0.25in; text-indent: -0.25in">&nbsp;</P>
  
  <P STYLE="font: 11pt/normal Calibri, Helvetica, Sans-Serif; margin: 0 0 0 0.25in; text-indent: -0.25in"><FONT STYLE="font: 10pt Wingdings">o</FONT><FONT STYLE="font: 3pt Times New Roman, Times, Serif">&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;&nbsp;
  </FONT><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Pre-commencement communications pursuant to Rule&nbsp;13e-4(c)&nbsp;under
  the Exchange Act (17 CFR 240.13e-4(c))</FONT></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 1pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
  
  
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  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>Item 1.01.&#9;Entry into a Material Definitive Agreement.</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">On July 7, 2014, DSI Realty Income Fund
  VII (the &ldquo;Company&rdquo;) together with seven (7) other affiliated limited partnerships (the &ldquo;Partnerships&rdquo;)
  entered in to Purchase and Sale Agreement (the &ldquo;Agreement&rdquo;) with Strategic Storage Opportunities, LLC (&ldquo;Strategic&rdquo;)
  for the sale of all five (5) of the Company&rsquo;s self-storage properties and 27 properties of the Partnerships (the &ldquo;Properties&rdquo;)
  to certain affiliates of Strategic for an aggregate sales price of $144,120,000, $16,840,000 of which has been allocated to the
  Company&rsquo;s Properties. On August 14, 2014, Strategic&rsquo;s approval period for the review of the Properties expired and
  the Agreement became definitive. A copy of the Agreement is attached hereto as Exhibit 10.1.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">The Agreement is subject to approval
  by the holders of a majority of the outstanding units of limited partnership interests of the Company and the Partnerships, as
  well as other conditions to closing; therefore, there can be no assurance that the transactions contemplated by the Agreement will
  be successfully completed. Under the Agreement, the Company and the Partnerships will be paid in cash for the sale of the Properties
  at various closing dates following the receipt of limited partner consent. If the Company or any of the Partnerships do not approve
  the Agreement, Strategic will have the option to terminate the Agreement without penalty.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">The Company and the Partnerships will
  commence the solicitation of limited partners written consent without a meeting as soon as definitive proxy statements are completed
  and filed with the Securities and Exchange Commission. Among other things, in addition to approval of the Agreement, the Company&rsquo;s
  limited partners will be asked to approve the dissolution of the Company following the distribution to limited partners of the
  net cash proceeds to the Company from the sale of the Properties.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">This Form 8-K contains forward-looking
  statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those
  projected. The most significant among these risks and uncertainties are: (i) the ability of the Company to obtain written consent
  of the limited partners to approve the Agreement; (ii) the approval of the Agreement by the limited partners of the Partnerships;
  and (iii) the Company&rsquo;s ability to meet the various conditions to the sale of the Properties under the Agreement. The cautionary
  statements provided above are being made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995 (the
  &ldquo;Act&rdquo;) and with the intention of obtaining the benefits of the &ldquo;safe harbor&rdquo; provisions of the Act for
  any such forward-looking information. Additional risks that may affect the Company&rsquo;s future performance are detailed in the
  Company&rsquo;s filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and its
  Quarterly Reports on Form 10-Q.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>
  
  <P STYLE="font: 11pt/normal Times New Roman, Times, Serif; margin: 0"><FONT STYLE="font-size: 10pt"><B>Item 9.01.</B></FONT><B><FONT STYLE="font-size: 8.5pt">&nbsp;&nbsp;&nbsp;</FONT><FONT STYLE="font-size: 10pt">Financial
  Statements and Exhibits.</FONT></B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">(d)&nbsp;Exhibits.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 10pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: bottom">
      <TD STYLE="width: 23%; border-bottom: windowtext 1pt solid; line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Exhibit&nbsp;No.</FONT></TD>
      <TD STYLE="width: 4%; text-align: center; line-height: 115%">&nbsp;</TD>
      <TD STYLE="width: 73%; border-bottom: windowtext 1pt solid; line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Exhibit&nbsp;Description</FONT></TD></TR>
  <TR>
      <TD STYLE="vertical-align: top; line-height: 115%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">10.1</FONT></TD>
      <TD STYLE="vertical-align: bottom; line-height: 115%; font-size: 11pt">&nbsp;</TD>
      <TD STYLE="vertical-align: top; line-height: 115%; font-size: 11pt"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Purchase and Sale Agreement dated July 7, 2014, as amended.</FONT></TD></TR>
  </TABLE>
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>&#9;Signature</B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center; text-indent: 0.5in">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 25pt">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.</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 25pt">&nbsp;</P>
  
  <TABLE CELLSPACING="0" CELLPADDING="0" STYLE="font: 11pt Calibri, Helvetica, Sans-Serif; width: 100%; border-collapse: collapse">
  <TR STYLE="vertical-align: top">
      <TD STYLE="line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Date: August 19, 2014</FONT></TD>
      <TD COLSPAN="2">
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>DSI Realty Income Fund VII</B></P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>&nbsp;</B></P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0"><B>By: DSI Properties, Inc.,</B></P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in"><B>General Partner</B></P>
          <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P></TD></TR>
  <TR STYLE="vertical-align: top">
      <TD STYLE="width: 41%; line-height: 115%">&nbsp;</TD>
      <TD STYLE="width: 4%; line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">By:</FONT></TD>
      <TD STYLE="width: 55%; border-bottom: windowtext 1pt solid; line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">/s/ RICHARD P. CONWAY</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
      <TD STYLE="line-height: 115%">&nbsp;</TD>
      <TD STYLE="line-height: 115%">&nbsp;</TD>
      <TD STYLE="line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Richard P. Conway</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
      <TD STYLE="line-height: 115%">&nbsp;</TD>
      <TD STYLE="line-height: 115%">&nbsp;</TD>
      <TD STYLE="line-height: 115%"><FONT STYLE="font: 10pt Times New Roman, Times, Serif">Executive Vice President and Chief Financial Officer</FONT></TD></TR>
  <TR STYLE="vertical-align: top">
      <TD STYLE="line-height: 115%">&nbsp;</TD>
      <TD>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-indent: 0.5in">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P></TD>
      <TD>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">&nbsp;</P>
          <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0">2</P></TD></TR>
  </TABLE>
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B><U>EXHIBIT 10.1</U></B></P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center"><B>&nbsp;</B></P>
  
  <P STYLE="font: 12pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">&nbsp;</P>
  
  <P STYLE="font: 10pt/normal Times New Roman, Times, Serif; margin: 0; text-align: center">Purchase and Sale Agreement dated July
  7, 2014 as amended</P>
  
  
  
  <P STYLE="margin: 0"></P>
  
  </BODY>
  </HTML>
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metadata_filer: {"company-data": {"conformed-name": "DSI REALTY INCOME FUND VII", "cik": "0000719581", "assigned-sic": "6500", "irs-number": "953871044", "state-of-incorporation": "CA", "fiscal-year-end": "1231"}, "filing-values": {"form-type": "8-K", "act": "34", "file-number": "002-83291", "film-number": "141054532"}, "business-address": {"street1": "PO BOX 357", "city": "LONG BEACH", "state": "CA", "zip": "90801", "phone": "3105957711"}, "mail-address": {"street1": "PO BOX 357", "city": "LONG BEACH", "state": "CA", "zip": "90801"}}
text: 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)
  August 14, 2014
  DSI REALTY INCOME FIND VII
  (Exact name of registrant as specified
  in its charter)
  California
  2-83291
  95-3871044
  (State or other jurisdiction
  of incorporation)
  (Commission
  File Number)
  (I.R.S. Employer
  Identification No.)
  6700 E. Pacific Coast Hwy., Long Beach, CA
  90803
  (Address of principal executive offices)
  (Zip Code)
  Registrant's telephone number,
  including area code
  (562) 493-8881
  Not Applicable
  (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:
  o
  Written communications pursuant to Rule 425 under the Securities
  Act (17 CFR 230.425)
  o
  Soliciting material pursuant to Rule 14a-12 under the Exchange
  Act (17 CFR 240.14a-12)
  o
  Pre-commencement communications pursuant to Rule 14d-2(b) under
  the Exchange Act (17 CFR 240.14d-2(b))
  o
  Pre-commencement communications pursuant to Rule 13e-4(c) under
  the Exchange Act (17 CFR 240.13e-4(c))
  Item 1.01.	Entry into a Material Definitive Agreement.
  On July 7, 2014, DSI Realty Income Fund
  VII (the "Company") together with seven (7) other affiliated limited partnerships (the "Partnerships")
  entered in to Purchase and Sale Agreement (the "Agreement") with Strategic Storage Opportunities, LLC ("Strategic")
  for the sale of all five (5) of the Company's self-storage properties and 27 properties of the Partnerships (the "Properties")
  to certain affiliates of Strategic for an aggregate sales price of $144,120,000, $16,840,000 of which has been allocated to the
  Company's Properties. On August 14, 2014, Strategic's approval period for the review of the Properties expired and
  the Agreement became definitive. A copy of the Agreement is attached hereto as Exhibit 10.1.
  The Agreement is subject to approval
  by the holders of a majority of the outstanding units of limited partnership interests of the Company and the Partnerships, as
  well as other conditions to closing; therefore, there can be no assurance that the transactions contemplated by the Agreement will
  be successfully completed. Under the Agreement, the Company and the Partnerships will be paid in cash for the sale of the Properties
  at various closing dates following the receipt of limited partner consent. If the Company or any of the Partnerships do not approve
  the Agreement, Strategic will have the option to terminate the Agreement without penalty.
  The Company and the Partnerships will
  commence the solicitation of limited partners written consent without a meeting as soon as definitive proxy statements are completed
  and filed with the Securities and Exchange Commission. Among other things, in addition to approval of the Agreement, the Company's
  limited partners will be asked to approve the dissolution of the Company following the distribution to limited partners of the
  net cash proceeds to the Company from the sale of the Properties.
  This Form 8-K contains forward-looking
  statements that are subject to certain risks and uncertainties that could cause actual results to differ materially from those
  projected. The most significant among these risks and uncertainties are: (i) the ability of the Company to obtain written consent
  of the limited partners to approve the Agreement; (ii) the approval of the Agreement by the limited partners of the Partnerships;
  and (iii) the Company's ability to meet the various conditions to the sale of the Properties under the Agreement. The cautionary
  statements provided above are being made pursuant to the provisions of the Private Securities Litigation Reform Act of 1995 (the
  "Act") and with the intention of obtaining the benefits of the "safe harbor" provisions of the Act for
  any such forward-looking information. Additional risks that may affect the Company's future performance are detailed in the
  Company's filings with the Securities and Exchange Commission, including its most recent Annual Report on Form 10-K and its
  Quarterly Reports on Form 10-Q.
  Item 9.01.
  Financial
  Statements and Exhibits.
  (d) Exhibits.
  Exhibit No.
  Exhibit Description
  10.1
  Purchase and Sale Agreement dated July 7, 2014, as amended.
  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 hereunto duly authorized.
  Date: August 19, 2014
  DSI Realty Income Fund VII
  By: DSI Properties, Inc.,
  General Partner
  By:
  /s/ RICHARD P. CONWAY
  Richard P. Conway
  Executive Vice President and Chief Financial Officer
  2
  EXHIBIT 10.1
  Purchase and Sale Agreement dated July
  7, 2014 as amended