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

                                 FORM 10-Q

 [X]   QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 2010

 [ ]   TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE
       SECURITIES EXCHANGE ACT OF 1934

For the transition period from ______ to _____

Commission File Number: 1-10324


                          THE INTERGROUP CORPORATION
                          --------------------------
           (Exact name of registrant as specified in its charter)


          DELAWARE                                             13-3293645
 ------------------------------                            ------------------
(State or other jurisdiction of                           (IRS Employer
 incorporation or organization)                            Identification No.)


    10940 Wilshire Blvd., Suite 2150, Los Angeles, California       90024
    ---------------------------------------------------------     --------
          (Address of principal executive offices)               (Zip Code)


                                 (310) 889-2500
                          -----------------------------
                         (Registrant's telephone number)


Indicate by check mark whether the registrant (1) filed all reports required to
be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months
(or for such shorter period that the registrant was required to file such
reports), and (2) has been subject to such filing requirements for the past 90
days.  [x] Yes [ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an
accelerated filer, a non-accelerated filer, or a smaller reporting company.

   Large accelerated filer [ ]                 Accelerated filer [ ]

   Non-accelerated filer   [ ]                 Smaller reporting company [x]

Indicate by check mark whether the registrant is a shell company (as defined in
Rule 12b-2 of the Exchange Act.)   [ ] Yes [x] No

The number of shares outstanding of issuer's Common Stock, as of November 10,
2010, was 2,424,164.



                                   INDEX
                          THE INTERGROUP CORPORATION



PART  I.  FINANCIAL INFORMATION                                       PAGE

  Item 1.  Condensed Consolidated Financial Statements:

  Condensed Consolidated Balance Sheets
   As of September 30, 2010(Unaudited) and June 30, 2010                3

  Condensed Consolidated Statements of Operations(Unaudited)
   For the Three Months ended September 30, 2010 and 2009               4

  Condensed Consolidated Statements of Cash Flows(Unaudited)
   For the three months ended September 30, 2010 and 2009               5

  Notes to Condensed Consolidated Financial Statements (Unaudited)      6

  Item 2. Management's Discussion and Analysis of Financial
          Condition and Results of Operations                          16

  Item 4. Controls and Procedures                                      24


PART II. OTHER INFORMATION

Item 6. Exhibits                                                       24


SIGNATURES                                                             25

                                   -2-


                              PART I
                       FINANCIAL INFORMATION

Item 1 - Condensed Consolidated Financial Statements


                                THE INTERGROUP CORPORATION
                          CONDENSED CONSOLIDATED BALANCE SHEETS


                                                               September 30, 2010    June 30, 2010
                                                                   (Unaudited)
                                                                 --------------      -------------
                                                                                
ASSETS
  Investment in hotel, net                                         $ 41,121,000       $ 41,961,000
  Investment in real estate, net                                     61,171,000         61,184,000
  Properties held for sale                                            7,306,000          7,193,000
  Investment in marketable securities                                 8,672,000          7,712,000
  Other investments, net                                              6,462,000          6,651,000
  Cash and cash equivalents                                           1,869,000          1,140,000
  Restricted cash                                                     1,854,000          1,641,000
  Other assets, net                                                   4,097,000          4,645,000
                                                                    -----------        -----------
    Total assets                                                   $132,552,000       $132,127,000
                                                                    ===========        ===========

LIABILITIES AND SHAREHOLDERS' DEFICIT

Liabilities
  Accounts payable and other liabilities                           $ 10,876,000       $ 10,473,000
  Due to securities broker                                            3,203,000          2,235,000
  Obligations for securities sold                                     1,413,000          1,698,000
  Other notes payable                                                 3,397,000          3,688,000
  Mortgage notes payable - hotel                                     45,791,000         45,990,000
  Mortgage notes payable - real estate                               59,521,000         59,842,000
  Mortgage notes payable - property held for sale                    10,393,000         10,450,000
  Deferred income taxes                                               1,157,000          1,135,000
                                                                    -----------        -----------
    Total liabilities                                               135,751,000        135,511,000
                                                                    -----------        -----------

Commitments and contingencies

Shareholders' deficit:
  Preferred stock, $.01 par value, 100,000 shares
   authorized; none issued                                                    -                  -
  Common stock, $.01 par value, 4,000,000 shares authorized;
   3,310,588 and 3,290,872 issued; 2,421,600 and 2,401,884
   Outstanding, respectively                                             33,000             33,000
  Additional paid-in capital                                          9,218,000          9,109,000
  Retained earnings                                                   4,199,000          4,190,000
  Treasury stock, at cost, 888,988 shares                            (9,564,000)        (9,564,000)
                                                                    -----------        -----------
  Total Intergroup shareholders' equity                               3,886,000          3,768,000
  Noncontrolling interest                                            (7,085,000)        (7,152,000)
                                                                    -----------        -----------
Total shareholders' deficit                                          (3,199,000)        (3,384,000)
                                                                    -----------        -----------
Total liabilities and shareholders' deficit                        $132,552,000       $132,127,000
                                                                    ===========        ===========


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                   -3-



                           THE INTERGROUP CORPORATION
                 CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS
                                  (UNAUDITED)

For the three months ended September 30,                     2010           2009
                                                         -----------    -----------
                                                                 
Revenues:
 Hotel                                                  $  9,526,000   $  8,530,000
 Real estate                                               3,090,000      3,045,000
                                                         -----------    -----------
Total revenues                                            12,616,000     11,575,000
                                                         -----------    -----------
Costs and operating expenses:
 Hotel operating expenses                                 (7,317,000)    (6,876,000)
 Real estate operating expenses                           (1,568,000)    (1,446,000)
 Depreciation and amortization expense                    (1,764,000)    (1,669,000)
 General and administrative expense                         (472,000)      (478,000)
                                                         -----------    -----------
Total costs and operating expenses                       (11,121,000)   (10,469,000)
                                                         -----------    -----------
Income from operations                                     1,495,000      1,106,000
                                                         -----------    -----------
Other income(expense):
 Interest expense                                         (1,475,000)    (1,543,000)
 Net gain(loss) on marketable securities                     353,000     (1,322,000)
 Net unrealized income on other investments                   41,000              -
 Impairment loss on other investments                       (230,000)             -
 Dividend and interest income                                139,000         77,000
 Trading and margin interest expense                        (303,000)      (376,000)
                                                         -----------    -----------
Net other expense                                         (1,475,000)    (3,164,000)
                                                         -----------    -----------

Income(loss) before income taxes                              20,000     (2,058,000)
Income tax benefit                                            10,000        699,000
                                                         -----------    -----------
Net income(loss) from continuing operations                   30,000     (1,359,000)
                                                         -----------    -----------

Discontinued operations
  Income from discontinued operations                         78,000         53,000
  Provision for income tax expense                           (32,000)       (21,000)
                                                         -----------    -----------
Income from discontinued operations                           46,000         32,000
                                                         -----------    -----------
Net income(loss)                                              76,000     (1,327,000)
Less: Net (income)loss attributable to the
 noncontrolling interest                                     (67,000)       396,000
                                                         -----------    -----------
Net income(loss) attributable to Intergroup              $     9,000    $  (931,000)
                                                         ===========    ===========

Net income(loss) per share from continuing operations
  Basic                                                  $     0.03    $     (0.58)
  Diluted                                                $     0.03    $     (0.58)

Net income per share from discontinued operations
  Basic                                                  $     0.02    $      0.01
  Diluted                                                $     0.02    $      0.01

Net income(loss) per share attributable to InterGroup
  Basic                                                  $     0.00    $     (0.57)
  Diluted                                                $     0.00    $     (0.57)


Weighted average shares outstanding                        2,409,809      2,347,528
                                                         ===========    ===========
Diluted weighted average shares outstanding                2,484,809      2,397,303
                                                         ===========    ===========


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                   -4-



                         THE INTERGROUP CORPORATION
              CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
                                (UNAUDITED)

For the three months ended September 30,                 2010          2009
                                                      -----------    -----------
                                                               
Cash flows from operating activities:
  Net income(loss)                                    $    76,000    $(1,327,000)
  Adjustments to reconcile net income(loss) to
   cash provided by operating activities:
    Depreciation and amortization                       1,764,000      1,669,000
    Net unrealized (gain)loss on marketable securities   (466,000)     1,470,000
    Impairment loss on other investments                  230,000              -
    Net unrealized gain on other investments              (41,000)             -
    Stock compensation expense                            109,000         72,000
    Changes in assets and liabilities:
      Investment in marketable securities                (494,000)    (3,305,000)
      Other asset                                         401,000       (502,000)
      Accounts payable and other liabilities              534,000        404,000
      Due to securities broker                            968,000        338,000
      Obligation for securities sold                     (285,000)     3,456,000
      Deferred tax liability                               22,000       (678,000)
                                                      -----------    -----------
  Net cash provided by operating activities             2,818,000      1,597,000
                                                      -----------    -----------
Cash flows from investing activities:
  Investment in hotel                                    (434,000)      (336,000)
  Investment in real estate                              (574,000)       (29,000)
  Other investments                                             -       (650,000)
  Restricted cash                                        (213,0000       (43,000)
                                                       -----------    -----------
  Net cash used in investing activities                (1,221,000)    (1,058,000)
                                                      -----------    -----------
Cash flows from financing activities:
  Payment on other notes payable                         (291,000)      (175,000)
  Principal payments on mortgage notes payable           (577,000)      (509,000)
                                                      -----------    -----------
  Net cash used in financing activities                  (868,000)      (684,000)
                                                      -----------    -----------

Net increase(decrease) in cash and cash equivalents       729,000       (145,000)
Cash and cash equivalents at beginning of
 period                                                 1,140,000      1,024,000
                                                      -----------    -----------
Cash and cash equivalents at end of period           $  1,869,000   $    879,000
                                                      ===========    ===========

Supplemental information:

Interest paid                                        $  1,697,000   $  1,692,000
                                                      ===========    ===========


The accompanying notes are an integral part of these condensed consolidated
financial statements.

                                   -5-


                         THE INTERGROUP CORPORATION
          NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                 (UNAUDITED)


1.  BASIS OF PRESENTATION AND SIGNIFICANT ACCOUNTING POLICIES

The consolidated financial statements included herein have been prepared by The
InterGroup Corporation ("InterGroup" or the "Company"), without audit,
according to the rules and regulations of the Securities and Exchange
Commission.  Certain information and footnote disclosures normally included in
the consolidated financial statements prepared in accordance with generally
accepted accounting principles have been condensed or omitted pursuant to such
rules and regulations, although the Company believes the disclosures that are
made are adequate to make the information presented not misleading.  Further,
the consolidated financial statements reflect, in the opinion of management,
all adjustments (which included only normal recurring adjustments) necessary
for a fair statement of the financial position, cash flows and results of
operations as of and for the periods indicated.

It is suggested that these financial statements be read in conjunction with the
audited financial statements and the notes therein included in the Company's
Form 10-K for the year ended June 30, 2010.

The June 30, 2010 Condensed Consolidated Balance Sheet was obtained from the
Company's audited Form 10-K for the year ended June 30, 2010.

The results of operations for the three months ended September 30, 2010, are
not necessarily indicative of results to be expected for the full fiscal year
ending June 30, 2011.

As of September 30, 2010, the Company had the power to vote 80% of the voting
shares of Santa Fe Financial Corporation ("Santa Fe"), a public company (OTCBB:
SFEF).  This percentage includes the power to vote an approximately 4% interest
in the common stock in Santa Fe owned by the Company's Chairman and President
pursuant to a voting trust agreement entered into on June 30, 1998.

Santa Fe's revenue is primarily generated through the management of its 68.8%
owned subsidiary, Portsmouth Square, Inc. ("Portsmouth"), a public company
(OTCBB: PRSI). InterGroup also directly owns approximately 11.7% of the common
stock of Portsmouth. Portsmouth has a 50.0% limited partnership interest in
Justice and serves as one of the two general partners. The other general
partner, Evon Corporation ("Evon"), served as the managing general partner
until December 1, 2008 at which time Portsmouth assumed the role of managing
general partner.

Justice owns a 544-room hotel property located at 750 Kearny Street, San
Francisco California, known as the Hilton San Francisco Financial District (the
Hotel) and related facilities including a five level underground parking
garage. The Hotel is operated by the partnership as a full service Hilton brand
hotel pursuant to a Franchise License Agreement with Hilton Hotels Corporation.
Justice also has a Management Agreement with Prism Hospitality L.P. (Prism) to
perform the day-to-day management functions of the Hotel.

Justice leased the parking garage to Evon through September 30, 2008.
Effective October 1, 2008, Justice and Evon entered into an Installment Sale
Agreement whereby Justice purchased all of Evon's right, title, and interest in
the remaining term of its lease of the parking garage, which was to expire on
November 30, 2010, and other related assets.  Justice also agreed to assume

                                   -6-


Evon's contract with Ace Parking Management, Inc. ("Ace Parking") for the
management of the garage and any other liabilities related to the operation of
the garage commencing October 1, 2008.  The Partnership also leases a day spa
on the lobby level to Tru Spa.

Due to the temporary closing of the Hotel to undergo major renovations from May
2005 until January 2006 to transition and reposition the Hotel from a Holiday
Inn to a Hilton, and the substantial depreciation and amortization expenses
resulting from the renovations and operating losses incurred as the Hotel
ramped up operations after reopening, Justice has recorded net losses. These
losses were anticipated and planned for as part of the Partnership's renovation
and repositioning plan for Hotel and management considers those net losses to
be temporary. The Hotel has been generating positive cash flows from operations
since June 2006 and net income is expected to improve in the future, especially
since depreciation and amortization expenses attributable to the renovation
will decrease substantially. Despite the significant downturn in the economy,
management believes that the revenues expected to be generated from the Hotel,
garage and the Partnership's leases will be sufficient to meet all of the
Partnership's current and future obligations and financial requirements.
Management also believes that there is significant equity in the Hotel to
support additional borrowings, if necessary.

In addition to the operations of the Hotel, the Company also generates income
from the ownership of real estate.  Properties include apartment complexes,
commercial real estate, and two single-family houses as strategic investments.
The properties are located throughout the United States, but are concentrated
in Texas and Southern California.  The Company also has investments in
unimproved real property.  The Company's residential rental properties located
in California are managed by a professional third party property management
company.

In January 2010, the FASB issued ASU 2010-06, "Improving Disclosures About Fair
Value Measurements." Effective January 1, 2010, ASU 2010-06 requires the
separate disclosure of significant transfers into and out of the Level 1 and
Level 2 categories and the reasons for such transfers, and also requires fair
value measurement disclosures for each class of assets and liabilities as well
as disclosures about valuation techniques and inputs used for recurring and
nonrecurring Level 2 and Level 3 fair value measurements.  Effective in fiscal
years beginning after December 31, 2010, ASU 2010-06 also requires Level 3
disclosure of purchases, sales, issuances and settlements activity on a gross
rather than a net basis. These amendments resulted in additional disclosures in
the Company's condensed consolidated financial statements.

The Consolidation Topic of the FASB ASC 810 provides a new accounting provision
regarding the consolidation of variable interest entities ("VIEs"). The new
accounting provision modifies the existing quantitative guidance used in
determining the primary beneficiary of a VIE by requiring entities to
qualitatively assess whether an enterprise is a primary beneficiary, based on
whether the entity has (i) power over the significant activities of the VIE,
and (ii) an obligation to absorb losses or the right to receive benefits that
could be potentially significant to the VIE. Additionally, the accounting
provision requires an ongoing reconsideration of the primary beneficiary and
provides a framework for the events that triggers a reassessment of whether an
entity is a VIE. The new accounting update became effective for the Company on
July 1, 2010. The adoption of this guidance did not have a material effect on
the Company's condensed consolidated financial statements.

Effective February 2010, the Company adopted new accounting provisions which
remove the requirement for the Company to disclose the date through which
subsequent events have been evaluated in issued financial statements. The
Company has evaluated subsequent events through the date the condensed
consolidated financial statements were issued.

                                   -7-


Properties Held for Sale - Discontinued Operations

Properties are classified as held for sale when management commits to a plan to
sell the asset, the asset is available for immediate sale, an active program to
locate a buyer has been initiated, the sale of the asset is probable, the sale
of the asset is actively marketed and it is unlikely that significant changes
to the sale plan will be made or withdrawn. As of September 30, 2010, the
Company had two properties classified as held for sale in accordance with SFAS
No. 144, which requires that depreciation on these properties be stopped.

During the three months ended September 30, 2009, three properties were
classified as held for sale.  However, since then, one of the properties was no
longer considered held for sale. As the result, the operations of the this
property for the three months ended September 30, 2010 was reclassified from
discontinued operations to continuing operations to conform to current quarter
presentation.

Under the provisions of the SFAS No.144, Accounting for Impairment or Disposal
of Long-Lived Assets, which was primarily codified into ASC Topic 205-20
"Presentation of Financial Statements - Discontinued Operations, for properties
disposed of during the year or for properties for which the Company actively
markets for sale at a price that is reasonable in relation to its market value,
the properties are required to be classified as held for sale on the balance
sheet and accounted for under discontinued operations in the statement of
operations.  The revenues and expenses from the operation of these properties
have been reclassified from continuing operations for the three months ended
September 30, 2010 and 2009 and reported as income from discontinued operations
in the consolidated statements of operations.

Earnings Per Share

Basic income(loss) per share is computed by dividing net income(loss) available
to common stockholders by the weighted average number of common shares
outstanding.  The computation of diluted income(loss) per share is similar to
the computation of basic earnings per share except that the weighted-average
number of common shares is increased to include the number of additional common
shares that would have been outstanding if potential dilutive common shares had
been issued.  The Company's only potentially dilutive common shares are stock
options and restricted stock units.  As of September 30, 2010, the Company had
75,000 stock options that were considered potentially dilutive common shares.
As of September 30, 2009, the Company had 15,000 stock options that were
considered potentially dilutive common shares and 34,775 restricted stock units
that were considered anti-dilutive.


NOTE 2 - INVESTMENT IN HOTEL, NET

Hotel property and equipment consisted of the following:

                                             Accumulated        Net Book
As of September 30, 2010      Cost           Depreciation         Value
                          ------------       ------------     ------------
Land                      $  2,738,000       $          -     $  2,738,000
Furniture and equipment     18,569,000        (15,640,000)       2,929,000
Building and improvements   55,015,000        (19,561,000)      35,454,000
                          ------------       ------------     ------------
                          $ 76,322,000       $(35,201,000)    $ 41,121,000
                          ============       ============     ============

                                   -8-


June 30, 2010                                Accumulated       Net Book
                               Cost          Depreciation        Value
                          ------------       ------------     ------------
Land                      $  2,738,000       $          -     $  2,738,000
Furniture and equipment     18,393,000        (14,710,000)       3,683,000
Building and improvements   54,782,000        (19,242,000)      35,540,000
                          ------------       ------------     ------------
                          $ 75,913,000       $(33,952,000)    $ 41,961,000
                          ============       ============     ============


NOTE 3 - INVESTMENT IN REAL ESTATE, NET

Investment in real estate included the following:

                                       September 30, 2010       June 30, 2010
                                         --------------         -------------

  Land                                    $  24,735,000          $ 24,735,000
  Buildings, improvements and equipment      61,219,000            60,758,000
  Accumulated depreciation                  (24,783,000)          (24,309,000)
                                             ----------            ----------
                                          $  61,171,000          $ 61,184,000
                                             ==========            ==========


NOTE 4 - PROPERTY HELD FOR SALE AND DISCONTINUED OPERATIONS

As of September 30, 2010, the Company had two properties located in Texas
classified as held for sale.   The revenues and expenses from the operation for
these two properties have been reclassified from continuing operations and
reported as income from discontinued operations in the consolidated statements
of operations for the respective periods.

The revenues and expenses from the operation of these two properties during the
three ended September 30, 2010 and 2009, are summarized as follows:

For the three months ended September 30,     2010              2009
                                          ----------        ----------
      Revenues                            $  603,000       $   603,000
      Expenses                              (525,000)         (550,000)
                                          ----------        ----------
       Income                             $   78,000       $    53,000
                                          ==========        ==========


NOTE 5 - INVESTMENT IN MARKETABLE SECURITIES

The Company's investment in marketable securities consists primarily of
corporate equities. The Company has also invested in corporate bonds and income
producing securities, which may include interests in real estate based
companies and REITs, where financial benefit could inure to its shareholders
through income and/or capital gain.

At September 30, 2010 and June 30, 2010, all of the Company's marketable
securities are classified as trading securities.  The change in the unrealized
gains and losses on these investments are included in earnings.  Trading
securities are summarized as follows:

                                   -9-



As of September 30, 2010
                               Gross         Gross            Net             Market
Investment   Cost        Unrealized Gain Unrealized Loss  Unrealized Gain     Value
---------- -----------   --------------- ---------------  ---------------  ------------
                                                            
Corporate
Equities   $ 6,774,000    $ 2,981,000     ($1,083,000)      $ 1,898,000    $ 8,672,000




As of June 30, 2010
                               Gross         Gross            Net             Market
Investment   Cost        Unrealized Gain Unrealized Loss  Unrealized Gain     Value
---------- -----------   --------------- ---------------  ---------------  ------------
                                                            
Corporate
Equities   $ 6,311,000    $ 2,273,000     ($872,000)        $ 1,401,000    $ 7,712,000



As of September 30, 2010 and June 30, 2010, the Company had unrealized losses
of $795,000 and $679,000, respectively, related to securities held for over one
year.

Net gain(loss) on marketable securities on the statement of operations is
comprised of realized and unrealized gains(losses).  Below is the composition
of the net gain(loss) for the three months ended September 30, 2010 and 2009,
respectively.



For the three months ended September 30,                 2010             2009
                                                    -----------      -----------
                                                               
Realized (loss)gain on marketable securities        $  (113,000)     $   148,000
Unrealized gain(loss) on marketable securities          466,000       (1,470,000)
                                                    -----------      -----------
Net gain(loss) on marketable securities             $   353,000      $(1,322,000)
                                                    ===========      ===========


NOTE 6 - OTHER INVESTMENTS, NET

The Company may also invest, with the approval of the Securities Investment
Committee and other Company guidelines, in private investment equity funds and
other unlisted securities, such as convertible notes through private
placements. Those investments in non-marketable securities are carried at cost
on the Company's balance sheet as part of other investments, net of other than
temporary impairment losses.

As of September 30, 2010 and June 30, 2010, the Company had net other
investments of $6,462,000 and $6,651,000, respectively, which consist of the
following:

            Type                      September 30, 2010     June 30, 2010
   ---------------------------         -----------------  ----------------
   Private equity hedge fund           $       3,482,000  $      3,712,000
   Corporate debt instruments                  2,336,000         2,358,000
   Warrants - at fair value                      644,000           581,000
                                       -----------------  ----------------
                                       $       6,462,000  $      6,651,000
                                       =================  ================

During the three months ended September 30, 2010 and 2009, the Company recorded
impairment losses on other investments of $230,000 and $0, respectively.

As of September 30, 2010, the Company had investments in corporate debt and
equity instruments which had attached warrants that were considered derivative
instruments.  These warrants have an allocated cost basis of $400,000 and a
fair market value of $644,000.  During the three months ended September 30,
2010, the Company had an unrealized gain of $41,000 related to these warrants.

                                   -10-


NOTE  7 - FAIR VALUE MEASUREMENTS

The carrying values of the Company's non-financial instruments approximate fair
value due to their short maturities(i.e., accounts receivable, other assets,
accounts payable and other liabilities, due to securities broker, and
obligations for securities sold) or the nature and terms of the
obligation(i.e., other notes payable and mortgage note payable).

The assets measured at fair value on a recurring basis as of September 30, 2010
and June 30, 2010 are as follows:



Assets:                                 Level 1      Level 2        Level 3      September 30, 2010
-----------                            ---------    ---------      ---------       --------------
                                                                        
Cash                                 $ 1,869,000    $       -      $       -        $ 1,869,000
                                       ---------                                     ----------
Restricted cash                        1,854,000            -              -          1,854,000
                                       ---------                                     ----------
Other investments - warrants                   -      644,000              -            644,000
                                                     --------                        ----------
Investment in marketable securities
  Investment funds                     3,214,000                                      3,214,000
  REITs                                1,554,000                                      1,554,000
  Financial services                   1,147,000                                      1,147,000
  Basic materials                        902,000                                        902,000
  Other                                1,855,000                                      1,855,000
                                      ----------                                     ----------
                                       8,672,000                                      8,672,000
                                      ----------     --------       --------         ----------
                                     $12,395,000    $ 644,000      $       -        $13,039,000
                                      ==========     ========       ========         ==========


The assets measured at fair value on a recurring basis as of June 30, 2010 are
as follows:



Assets:                                 Level 1      Level 2        Level 3        June 30, 2010
-----------                            ---------    ---------      ---------       --------------
                                                                        
Cash                                 $ 1,140,000    $       -      $       -        $ 1,140,000
                                       ---------                                     ----------
Restricted cash                        1,641,000            -              -          1,641,000
                                       ---------                                     ----------
Other investments - warrants                   -      581,000              -            581,000
                                                     --------                        ----------
Investment in marketable securities
  Investment funds                     3,271,000                                      3,271,000
  REITs                                1,946,000                                      1,946,000
  Healthcare                             668,000                                        668,000
  Financial services                     551,000                                        551,000
  Other                                1,276,000                                      1,276,000
                                      ----------                                     ----------
                                       7,712,000                                      7,712,000
                                      ----------     --------       --------         ----------
                                     $10,493,000    $ 581,000      $       -        $11,074,000
                                      ==========     ========       ========         ==========


The fair values of investments in marketable securities are determined by the
most recently traded price of each security at the balance sheet date. The fair
value of the warrants was determined based upon a Black-Scholes option
valuation model.

                                   -11-


Financial assets that are measured at fair value on a non-recurring basis and
are not included in the tables above include "Other investments in non-
marketable securities," that were initially measured at cost and have been
written down to fair value as a result of impairment. The following table shows
the fair value hierarchy for these assets measured at fair value on a non-
recurring basis are as follows:


                                                                                              Loss for the
                                                                                            three months ended
Assets:                            Level 1   Level 2      Level 3    September 30, 2010     September 30, 2010
-----------                        -------   -------     ---------   ------------------     ------------------
                                                                               
Other non-marketable investments   $     -   $     -     $5,818,000       $5,818,000          $ (230,000)



                                                                                              Loss for the
                                                                                            three months ended
Assets:                            Level 1   Level 2      Level 3      June 30, 2010        September 30, 2009
-----------                        -------   -------     ---------   ------------------     ------------------
                                                                               
Other non-marketable investments   $     -   $     -     $6,070,000       $6,070,000          $        -



Other investments in non-marketable securities are carried at cost net of any
impairment loss.  The Company has no significant influence or control over the
entities that issue these investments.  These investments are reviewed on a
periodic basis for other-than-temporary impairment. The Company reviews several
factors to determine whether a loss is other-than-temporary. These factors
include but are not limited to: (i) the length of time an investment is in an
unrealized loss position, (ii) the extent to which fair value is less than
cost, (iii) the financial condition and near term prospects of the issuer and
(iv) our ability to hold the investment for a period of time sufficient to
allow for any anticipated recovery in fair value.


NOTE 8 - STOCK BASED COMPENSATION PLANS

The Company follows the Statement of Financial Accounting Standards 123
(Revised), "Share-Based Payments" ("SFAS No. 123R"), which was primarily
codified into ASC Topic 718 "Compensation - Stock Compensation", which
addresses accounting for equity-based compensation arrangements, including
employee stock options and restricted stock units.

Please refer to NOTE 16 - STOCK-BASED COMPENSATION PLANS in the Company's Form
10-K for the year ended June 30, 2010 for more detail information on the
Company's stock-based compensation plans.

During the three months ended September 30, 2010, the Company recorded stock
option compensation cost of $37,000 related to issuance of stock options.  As
of September 30, 2010, there was a total of $229,000 of unamortized
compensation related to stock options which is expected to be recognized over
the weighted-average of 5 years.

The fair value of options is measured by applying the Black-Scholes model on
grant date.

Expected volatility                         51.6%
Expected term                             7 years
Expected dividend yield                        0%
Risk-free interest rate                     2.36%

                                   -12-


The following table summarizes the stock options outstanding as of September
30, 2010:


                                                                                           Aggregate
                                      Number of       Weighted-average  Weighted Average   Intrinsic
                                       Shares          Exercise Price    Remaining Life      Value
                                      ----------       ---------------  ----------------   ---------
                                                                              
Outstanding at June 30, 2009           102,000                $12.47       3.15 years     $   52,000
Granted                                105,000                 10.30
Exercised                               (3,000)                12.00
Forfeited                                    -                     -
Exchanged                              (12,000)                12.00
                                      ----------       ---------------
Outstanding at June 30, 2010           192,000                $11.32       6.44 years     $  790,000
Granted                                      -                     -
Exercised                                    -                     -
Forfeited                                    -                     -
Exchanged                                    -                     -
                                      ----------       ---------------
Outstanding at September 30, 2010      192,000                $11.32       6.19 years     $1,087,000
                                      ==========       ===============  ================   =========

Exercisable at September 30, 2010       87,000                $12.55       2.27 years     $  269,000
                                      ==========       ===============  ================   =========


The table below summarizes the RSUs granted and outstanding.

                                                             Weighted Average
                                                                Grant Date
                                           Number of RSUs       Fair Value
                                           --------------    ----------------
RSUs outstanding as of June 30, 2009               95,215         $12.46
Granted                                             2,564         $15.26
Converted to common stock                         (65,215)        $ 8.42
                                           --------------    ----------------
RSUs outstanding as of June 30, 2010               32,564         $12.89
Granted                                                 -              -
Converted to common stock                         (15,000)        $15.50
                                           --------------    ----------------
RSUs outstanding as of September 30, 2010          17,564         $13.07
                                           ==============    ================

On July 1 of every year, as part of the Stock Compensation Plan for Non-
employee Directors, each non-employee director received an automatic grant of a
number of shares of Company's Common Stock equal in value to $18,000 ($72,000
total recorded as stock compensation expense) based on 100% of the fair market
value of the Company's stock on the day of grant.  During the three months
ended, September 30, 2010 and 2009, the four non-employee directors of the
Company received a total grant of 4,716 and 6,004 shares of common stock.


NOTE 9 - SEGMENT INFORMATION

The Company operates in three reportable segments, the operation of the hotel
("Hotel Operations"), the operation of its multi-family residential properties
("Real Estate Operations") and the investment of its cash in marketable
securities and other investments("Investment Transactions"). These three
operating segments, as presented in the financial statements, reflect how
management internally reviews each segment's performance.  Management also
makes operational and strategic decisions based on this information.

Information below represents reported segments for the three months ended
September 30, 2010 and 2009.  Operating income(loss) from hotel operations
consist of the operation of the hotel and operation of the garage.  Operating
income for rental properties consist of rental income.  Operating income for
investment transactions consist of net investment gain(loss) and dividend and
interest income.

                                   -13-



As of and for the
Three months ended            Hotel      Real Estate   Investment                                 Discontinued
September 30, 2010         Operations    Operations   Transactions      Other       Subtotal       Operations       Total
                           -----------   -----------  ------------   -----------   ------------   ------------   ------------
                                                                                            
Revenues                   $ 9,526,000   $ 3,090,000   $         -   $         -   $ 12,616,000   $    603,000   $ 13,219,000
Operating expenses          (8,605,000)   (2,044,000)            -      (472,000)   (11,121,000)      (378,000)   (11,499,000)
                           -----------   -----------   -----------   -----------   ------------   ------------   ------------
Income(loss)from operations    921,000     1,046,000             -      (472,000)     1,495,000        225,000      1,720,000

Interest expense              (703,000)     (772,000)            -             -     (1,475,000)      (147,000)    (1,622,000)
Loss from investments                -             -             -             -              -              -              -
Income tax benefit(expense)          -             -             -        10,000         10,000        (32,000)       (22,000)
                           -----------   -----------   -----------   -----------   ------------   ------------   ------------
Net income(loss)           $   218,000   $   274,000   $         -  $   (462,000)  $     30,000   $     46,000   $     76,000
                           ===========   ===========   ===========   ===========   ============   ============   ============
Total Assets               $41,121,000   $61,171,000   $15,134,000   $ 7,820,000   $125,246,000   $  7,306,000   $132,552,000
                           ===========   ===========   ===========   ===========   ============   ============   ============


As of and for the
Three months ended           Hotel       Real Estate   Investment                                 Discontinued
September 30, 2009         Operations    Operations   Transactions      Other       Subtotal       Operations       Total
                           -----------   -----------  ------------   -----------   ------------   ------------   ------------
Revenues                   $ 8,530,000   $ 3,045,000   $         -   $         -   $ 11,575,000   $    603,000   $ 12,178,000
Operating expenses          (8,058,000)   (1,934,000)            -      (477,000)   (10,469,000)      (401,000)   (10,870,000)
                           -----------   -----------   -----------   -----------   ------------   ------------   ------------
Income(loss)from operations    472,000     1,111,000             -      (477,000)     1,106,000        202,000      1,308,000

Interest expense              (713,000)     (830,000)            -             -     (1,543,000)      (149,000)    (1,692,000)
Depreciation and
 amortization expense                -             -             -             -             -               -             -
Income(loss)
 from investments                    -             -    (1,621,000)            -     (1,621,000)             -     (1,621,000)
Income tax benefit(expense)          -             -             -       699,000        699,000        (21,000)       678,000
                           -----------   -----------   -----------   -----------   ------------   ------------   ------------
Net income(loss)           $  (241,000)  $   281,000   $(1,621,000)  $   222,000   $ (1,359,000) $      32,000   $ (1,327,000)
                           ===========   ===========   ===========   ===========   ============   ============   ============
Total Assets               $43,946,000   $61,184,000   $22,972,000   $ 8,664,000   $136,766,000  $   7,155,000   $143,921,000
                           ===========   ===========   ===========   ===========   ============   ============   ============



NOTE 10 - RELATED PARTY TRANSACTIONS

Four of the Portsmouth directors serve as directors of Intergroup. Three of
those directors also serve as directors of Santa Fe.  The three Santa Fe
directors also serve as directors of Intergroup.

During the three months ended September 30, 2010, the Portsmouth received
management fees from Justice Investors totaling $79,000 and $78,000,
respectively.  These amounts were eliminated in consolidation.

John V. Winfield serves as Chief Executive Officer and Chairman of the Company,
Portsmouth and Santa Fe.  Depending on certain market conditions and various
risk factors, the Chief Executive Officer, his family, Portsmouth and Santa Fe
may, at times, invest in the same companies in which the Company invests.  The
Company encourages such investments because it places personal resources of the
Chief Executive Officer and his family members, and the resources of Portsmouth
and Santa Fe, at risk in connection with investment decisions made on behalf of
the Company.

                                   -14-


NOTE 11 - SUBSEQUENT EVENTS

Other Investments

On October 20, 2010, the Company exchanged approximately $13,231,000 in notes,
convertible notes and debt instruments that it held in Comstock Mining, Inc.
("Comstock" - OTCBB: LODE)) for 13,231 shares of newly created 7 1/2% Series A-
1 Convertible Preferred Stock (the "A-1 Preferred") of Comstock. As of
September 30, 2010, those notes and convertible debt instruments had a carrying
value of $1,875,000 (net of impairment adjustments) which was included in the
other investments, net amount of $6,462,000 on the Company's consolidated
balance sheet.

Each share of A-1 Preferred has a stated value of $1,000 per share and a
liquidation and change of control preference equal to the stated value plus
accrued and unpaid dividends.  Commencing January 1, 2011, the holders are
entitled to semi-annual dividends at a rate of 7.5% per annum, payable in cash,
common stock, preferred stock or any combination of the foregoing, at the
election of Comstock. At the holder's election, each share of A-1 Preferred is
convertible at a fixed conversion rate (subject to anti-dilution) into 1,536
shares of common stock of Comstock, therefore converting into common stock at a
conversion price of $0.6510.  Each share of A-1 Preferred will entitle the
holder to vote with the holders of common stock as a single class on all
matters submitted to the vote of the common stock (on an as converted basis)
and, for purposes of voting only, each share of A-1 Preferred shall be entitled
to five times the number of votes per common share to which it would otherwise
be entitled. Each share of A-1 Preferred shall entitle its holder to one (1)
vote in any matter submitted to vote of holders of Preferred Stock, voting as a
separate class. The A-1 Preferred, in conjunction with the other series of
newly created Preferred Stock of Comstock, also has certain rights requiring
consent of the Preferred Stock holders for Comstock to take certain corporate
and business actions. The holders will have registration rights with respect to
the shares of common stock underlying the A-1 Preferred and also preemptive
rights. In addition, so long as the holders of the A-1 Preferred hold 25% or
more of the total Preferred Stock of Comstock, (i) Mr. Winfield will be a
member of Comstock's board of directors and (ii) the A-1 Preferred holders will
have the right, upon written request to Comstock, to nominate a member of
Comstock's board of directors who meet the definition of an "independent"
director" and other requirements. The foregoing description of the A-1
Preferred and the specific terms of the A-1 Preferred is qualified in its
entirety by reference to the provisions of the Series A Securities Purchase
Agreement, the Certificate of Designation of Preferences and Rights and
Limitations of 7 1/2% Series A-1 Convertible Preferred Stock and the
Registration Rights Agreement for the Series A Preferred Stock, which were
filed as exhibits to the Company's Current Report on Form 8-K, dated October
20, 2010.

Refinancing

In November 2010, the Company refinanced its $1,641,000 adjustable rate
mortgage note payable on its 27-unit apartment building for a new 10-year fixed
rate mortgage in the amount of $3,260,000. The new loan provided approximately
$1,500,000 in cash back to Woodland Village. The interest rate on the new loan
is fixed at 4.85% per annum, with monthly principal and interest payments based
on a 30-year amortization schedule. The note matures in December 2020.

In November 2010, the Company also refinanced its $3,569,000 adjustable rate
mortgage note payable on its 31-unit apartment building for a new 10-year fixed
rate mortgage in the amount of $5,787,000. The new loan provided approximately
$2,069,000 in cash back to the Company. The interest rate on the new loan is
fixed at 4.85% per annum, with monthly principal and interest payments based on
a 30-year amortization schedule. The note matures in December 2020.

                                   -15-


Item 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
         CONDITION AND RESULTS OF OPERATIONS

FORWARD-LOOKING STATEMENTS AND PROJECTIONS

The Company may from time to time make forward-looking statements and
projections concerning future expectations.  When used in this discussion, the
words "anticipate," "estimate," "expect," "project," "intend," "plan,"
"believe," "may," "could," "might" and similar expressions, are intended to
identify forward-looking statements.  These statements are subject to certain
risks and uncertainties, such as national and worldwide economic conditions,
including the impact of recessionary conditions on tourism, travel and the
lodging industry, the impact of terrorism and war on the national and
international economies, including tourism and securities markets, energy and
fuel costs, natural disasters, general economic conditions and competition in
the hotel industry in the San Francisco area, seasonality, labor relations and
labor disruptions, actual and threatened pandemics such as swine flu,
partnership distributions, the ability to obtain financing at favorable
interest rates and terms, securities markets, regulatory factors, litigation
and other factors discussed below in this Report and in the Company's Annual
Report on Form 10-K for the fiscal year ended June 30, 2010, that could cause
actual results to differ materially from those projected.  Readers are
cautioned not to place undue reliance on these forward-looking statements,
which speak only as to the date hereof.  The Company undertakes no obligation
to publicly release the results of any revisions to those forward-looking
statements, which may be made to reflect events or circumstances after the date
hereof or to reflect the occurrence of unanticipated events.


RESULTS OF OPERATIONS

The Company's principal sources of revenue continue to be derived from the
investment of its 68.8% owned subsidiary, Portsmouth, in the Justice Investors
limited partnership ("Justice" or the "Partnership"), rental income from its
investments in multi-family real estate properties and income received from
investment of its cash and securities assets.  Portsmouth has a 50.0% limited
partnership interest in Justice and serves as the managing general partner of
Justice. Evon Corporation ("Evon") serves as the other general partner. Justice
owns the land, improvements and leaseholds at 750 Kearny Street, San Francisco,
California, known as the Hilton San Francisco Financial District (the "Hotel").
The financial statements of Justice have been consolidated with those of the
Company.

The Hotel is operated by the Partnership as a full service Hilton brand hotel
pursuant to a Franchise License Agreement with Hilton Hotels Corporation. The
term of the Agreement is for a period of 15 years commencing on January 12,
2006, with an option to extend the license term for another five years, subject
to certain conditions. Justice also has a Management Agreement with Prism
Hospitality L.P. ("Prism") to perform the day-to-day management functions of
the Hotel.

Until September 30, 2008, the Partnership also derived income from the lease of
the parking garage to Evon.  Effective October 1, 2008, Justice entered into an
installment sale agreement with Evon to purchase the remaining term of the
garage lease and related garage assets, and assumed the contract with Ace
Parking for the operations of the garage. Justice also leases a portion of the
lobby level of the Hotel to a day spa operator.  Portsmouth also receives
management fees as a general partner of Justice for its services in overseeing
and managing the Partnership's assets. Those fees are eliminated in
consolidation.

                                   -16-


In addition to the operations of the Hotel, the Company also generates income
from the ownership and management of real estate.  Properties include eighteen
apartment complexes, two commercial real estate properties, and two single-
family houses as strategic investments.  The properties are located throughout
the United States, but are concentrated in Texas and Southern California.  The
Company also has investments in unimproved real property.  All of the Company's
residential rental properties in California are managed by professional third
party property management companies and the rental properties outside of
California are managed by the Company. The commercial real estate in California
is also managed by the Company.

The Company acquires its investments in real estate and other investments
utilizing cash, securities or debt, subject to approval or guidelines of the
Board of Directors.  The Company also invests in income-producing instruments,
equity and debt securities and will consider other investments if such
investments offer growth or profit potential.


Three Months Ended September 30, 2010 Compared to the Three Months Ended
September 30, 2009

The Company had net income of $76,000 for the three months ended September 30,
2010 compared to net loss of $1,327,000 for the three months ended September
30, 2009. The change is primarily attributable to the net gain on marketable
securities during the most recent quarter compared to a significant net loss on
marketable securities in the prior comparable quarter and the increase in
income from hotel operations, partially offset by the impairment loss on other
investments.

The Company had income from hotel operations of $218,000 for the three months
ended September 30, 2010, compared to a loss of $241,000 for the three months
ended September 30, 2009. The following table sets forth a more detailed
presentation of Hotel operations for the three months ended September 30, 2010
and 2009.



For the three months ended September 30,                        2010            2009
----------------------------------------                     ----------      ----------
                                                                     
Hotel revenues:
 Hotel rooms                                                $ 7,515,000    $  6,732,000
 Food and beverage                                            1,181,000         951,000
 Garage                                                         636,000         668,000
 Other                                                          194,000         179,000
                                                             ----------      ----------
  Total hotel revenues                                        9,526,000       8,530,000

Operating expenses, excluding interest, depreciation and
 amortization                                                (7,317,000)     (6,876,000)
                                                             ----------      ----------
Operating income before interest, depreciation and
 amortization                                                 2,209,000       1,654,000
Interest expense                                               (703,000)       (713,000)
Depreciation and amortization expense                        (1,288,000)     (1,182,000)
                                                             ----------      ----------
Income (loss) from hotel operations                         $   218,000     $  (241,000)
                                                             ==========      ==========


For the three months ended September 30, 2010, the Hotel generated operating
income of $2,209,000 before interest, depreciation and amortization, on
operating revenues of $9,526,000 compared to operating income of $1,654,000
before interest, depreciation and amortization, on operating revenues of
$8,530,000 for the three months ended September 30, 2009. The increase in

                                   -17-


income from Hotel operations is primarily attributable to an increase in room
and food and beverage revenues in the current period, partially offset by a
decrease in garage revenues and an increase in depreciation and amortization
expense due to improvements to the Hotel made after the prior period, including
upgrades to the guest rooms and installation of energy saving controls and
devices.

Room revenues increased by $783,000 for the three months ended September 30,
2010 compared to the three months ended September 30, 2009 and food and
beverage revenues increased by $230,000 for the same period. The increase in
room revenues was primarily attributable to a significant increase in average
daily room rates during the three months ended September 30, 2010 as the Hotel
began to see an increase in higher rated corporate and group business travel,
which also resulted in higher in food and beverage revenues. The modest
decrease in garage revenues was primarily attributable to slightly lower Hotel
occupancy during the current period.

The following table sets forth the average daily room rate, average occupancy
percentage and room revenue per available room ("RevPar") of the Hotel for the
three months ended September 30, 2010 and 2009.

Three Months Ended         Average           Average
   September 30,          Daily Rate        Occupancy%         RevPar
-----------------         ----------        ---------         --------
      2010                   $168              89%              $150
      2009                   $147              92%              $135

The operations of the Hotel began to experience an increase in the higher rated
business and group travel segments as the hospitality industry began so see
some recovery. As a result, the Hotel's average daily rate increased by $21 for
the three months ended September 30, 2010 compared to the three months ended
September 30, 2010. The modest decrease in occupancy of 3% was due to the Hotel
being able to displace some of the discounted Internet business that the Hotel
was forced to take in the prior period to maintain occupancy in a very
competitive market with higher rated business. As a result, the Hotel was able
to achieve a RevPar number that was $15 higher than the prior period.

In this highly competitive market, management has also continued to focus on
ways to enhance the guest experience as well as improve operating efficiencies.
The Hotel has recently upgraded its guest room with newer flat panel television
systems that provide guests with greater entertainment options. The Hotel has
also installed many energy saving controls and devices as part of its efforts
to become greener and reduce operating costs. Management will continue to
explore new and innovative ways to improve operations and attract new guests,
including international travelers, to the Hotel at higher room rates.

While operating in a challenging economy, real estate operations remained
relatively consistent.  The Company had real estate revenues of $3,090,000 for
the three months ended September 30, 2010 compared with revenues of $3,045,000
for the three months ended September 30, 2009.  While rental revenues increased
by $45,000, real estate operating expenses also increased by $122,000.
Interest expense decreased to $772,000 from $830,000 as the result of interest
rates resetting lower on a certain number of our properties located in Los
Angeles, California.  Management continues to review and analyze the Company's
real estate operations to improve occupancy and rental rates and to reduce
expenses and improve efficiencies.

As of September 30, 2010, the Company had listed for sale its 249-unit
apartment building located in Austin, Texas and its 132-unit apartment located
in San Antonio, Texas.  These properties are classified as held for sale on the

                                   -18-


Company's condensed consolidated balance sheet with the operations of these
properties classified under discontinued operations in the condensed
consolidated statements of operations.

The Company had a net gain on marketable securities of $353,000 for the three
months ended September 30, 2010 compared to a loss of $1,322,000 for the three
months ended September 30, 2009.  For the three months ended September 30,
2010, the Company had a net realized loss of $113,000 and a net unrealized gain
of $466,000.  For the three months ended September 30, 2009, the Company had a
net realized gain of $148,000 and net unrealized loss of $1,470,000.  Gains and
losses on marketable securities may fluctuate significantly from period to
period in the future and could have a significant impact on the Company's
results of operations.  However, the amount of gain or loss on marketable
securities for any given period may have no predictive value and variations in
amount from period to period may have no analytical value. For a more detailed
description of the composition of the Company's marketable securities please
see the Marketable Securities section below.

The Company may also invest, with the approval of the Securities Investment
Committee and other company guidelines, in private investment equity funds and
other unlisted securities, such as convertible notes through private
placements. Those investments in non-marketable securities are carried at cost
on the Company's balance sheet as part of other investments, net of other than
temporary impairment losses. As of September 30, 2010, the Company had net
other investments of $6,462,000. Included in other investments are investments
in corporate debt and equity instruments which had attached warrants that were
considered derivative instruments.  The Company recorded an unrealized gain of
$41,000 related to these warrants during the three months ended September 30,
2010.  During the three months ended September 30, 2010 and 2009, the Company
performed an impairment analysis of its other investments and determined that
its investments had other than temporary impairments and recorded impairment
losses of $230,000 for the three months ended September 30, 2010.

Dividend and interest income increased to $139,000 for the three months ended
September 30, 2010 from $77,000 for the three months ended September 30, 2009
as the result of the increased investment in income yielding investments.

Margin interest and trading expenses decreased to $303,000 for the three months
ended September 30, 2010 from $376,000 for the three months ended September 30,
2009 primarily as the result of the decrease in margin interest expense related
to the decrease in the use of margin.

The provision for income tax expense as a percentage of the income before taxes
was higher for the three months ended September 30, 2010 as compared to the
three months ended September 30, 2009 primarily due to income from Justice
which resulted in a lower amount of noncontrolling interest that was reconciled
against the net income of the Company for income tax calculation purposes.


MARKETABLE SECURITIES AND OTHER INVESTMENTS

The Company's investment portfolio is diversified with 42 different equity
positions.  The portfolio contains four individual equity securities that are
more than 5% of the equity value of the portfolio with the largest security
being 17.5% of the value of the portfolio.  The amount of the Company's
investment in any particular issuer may increase or decrease, and additions or
deletions to its securities portfolio may occur, at any time.  While it is the
internal policy of the Company to limit its initial investment in any single
equity to less than 5% of its total portfolio value, that investment could

                                   -19-


eventually exceed 5% as a result of equity appreciation or reduction of other
positions.  Marketable securities are stated at market value as determined by
the most recently traded price of each security at the balance sheet date.

As of September 30, 2010 and June 30, 2010, the Company had investments in
marketable equity securities of $8,672,000 and $7,712,000, respectively. The
following table shows the composition of the Company's marketable securities
portfolio by selected industry groups as of September 30, 2010 and June 30,
2010.


   As of September 30, 2010
                                                              % of Total
                                                              Investment
   Industry Group                      Fair Value             Securities
   --------------                      ------------           ----------
   Investment funds                    $  3,214,000               37.1%
   REITs                                  1,554,000               17.9%
   Financial services                     1,147,000               13.2%
   Basic materials                          902,000               10.4%
   Other                                  1,855,000               21.3%
                                       ------------           ----------
                                       $  8,672,000              100.0%
                                       ============           ==========

   June 30, 2010                                              % of Total
                                                              Investment
   Industry Group                      Market Value           Securities
   --------------                      ------------           ----------
   Investment funds                    $  3,271,000               42.4%
   REITs                                  1,946,000               25.2%
   Healthcare                               668,000                8.7%
   Financial services                       551,000                7.1%
   Other                                  1,276,000               16.6%
                                         ----------              ------
                                       $  7,712,000              100.0%
                                         ==========              ======


The Company may also invest, with the approval of the Securities Investment
Committee and other Company guidelines, in private investment equity funds and
other unlisted securities, such as convertible notes through private
placements. Those investments in non-marketable securities are carried at cost
on the Company's balance sheet as part of other investments, net of other than
temporary impairment losses.

As of September 30, 2010, the Company had net other investments of $6,462,000.
Included in the net other investments are notes and convertible notes in
Comstock Mining, Inc. ("Comstock"), a public company, that had a carrying value
of $1,875,000 (net of impairment adjustments) as of September 30, 2010.  The
face value of these notes and convertible notes as of September 30, 2010
totaled approximately $13,231,000, which includes principal and accrued
interest. On October 20, 2010, the Company exchanged the $13,231,000 in notes,
convertible notes and debt instruments that it held in Comstock for 13,231
shares of newly created 7 1/2% Series A-1 Convertible Preferred Stock of
Comstock.  Please see NOTE 11 - SUBSEQUENT EVENTS of the notes to the condensed
consolidated financial statements for further discussion on the Company's other
investments.

                                   -20-


The following table shows the net gain or loss on the Company's marketable
securities and the associated margin interest and trading expenses for the
indicated periods.

For the three months ended September 30,        2010                   2009
                                          --------------        --------------
Net gain(loss) on marketable securities   $      353,000        $   (1,322,000)
Net unrealized gain on other investments          41,000                     -
Impairment loss on other investments            (230,000)                    -
Dividend & interest income                       139,000                77,000
Margin interest expense                          (75,000)             (136,000)
Trading and management expenses                 (228,000)             (240,000)
                                           -------------         -------------
                                           $           -        $   (1,621,000)
                                           =============         =============


FINANCIAL CONDITION AND LIQUIDITY

The Company's cash flows are primarily generated from its Hotel operations and
general partner fees from Justice. The Company also receives revenues generated
from the investment of its cash and marketable securities and other
investments. Since the operations of the Hotel were temporarily suspended on
May 31, 2005, and significant amounts of money were expended to renovate and
reposition the Hotel as a Hilton, Justice did not pay any partnership
distributions until the end of March 2007. As a result, the Company had to
depend more on the revenues generated from the investment of its cash and
marketable securities during that transition period.

The Hotel started to generate cash flows from its operations in June 2006. For
the fiscal year ended June 30, 2009, Justice paid a total of $850,000 in
limited partnership distributions, of which the Company received $425,000. The
fiscal 2009 distributions were paid in September 2008, after which the San
Francisco hotel market began to feel the full impact of the significant
downturn in domestic and international economies that continued throughout
fiscal 2009 and 2010. As a result, no Partnership distributions were paid in
fiscal 2010. Since no significant improvement in economic conditions is
expected in the lodging industry until sometime during 2011, no limited
partnership distributions are anticipated in the foreseeable future. The
general partners will continue to monitor and review the operations and
financial results of the Hotel and to set the amount of any future
distributions that may be appropriate based on operating results, cash flows
and other factors, including establishment of reasonable reserves for debt
payments and operating contingencies.

The new Justice Compensation Agreement that became effective on December 1,
2008, when Portsmouth assumed the role of managing general partner of Justice,
has provided additional cash flows to the Company. Under the new Compensation
Agreement, Portsmouth is now entitled to 80% of the minimum base fee to be paid
to the general partners of $285,000, while under the prior agreement,
Portsmouth was entitled to receive only 20% of the minimum base fee.  During
the three months ended September 30, 2010 and 2009, the Company received
management fees from Justice Investors totaling $79,000 and $78,000,
respectively.

To meet its substantial financial commitments for the renovation and transition
of the Hotel to a Hilton, Justice had to rely on borrowings to meet its
obligations. On July 27, 2005, Justice entered into a first mortgage loan with
The Prudential Insurance Company of America in a principal amount of
$30,000,000 (the "Prudential Loan").  The term of the Prudential Loan is for

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120 months at a fixed interest rate of 5.22% per annum. The Prudential Loan
calls for monthly installments of principal and interest in the amount of
approximately $165,000, calculated on a 30-year amortization schedule. The Loan
is collateralized by a first deed of trust on the Partnership's Hotel property,
including all improvements and personal property thereon and an assignment of
all present and future leases and rents. The Prudential Loan is without
recourse to the limited and general partners of Justice. The principal balance
of the Prudential Loan was $27,589,000 as of September 30, 2010.

On March 27, 2007, Justice entered into a second mortgage loan with Prudential
(the "Second Prudential Loan") in a principal amount of $19,000,000. The term
of the Second Prudential Loan is for 100 months and matures on August 5, 2015,
the same date as the first Prudential Loan. The Second Prudential Loan is at a
fixed interest rate of 6.42% per annum and calls for monthly installments of
principal and interest in the amount of $119,000, calculated on a 30-year
amortization schedule. The Second Prudential Loan is collateralized by a second
deed of trust on the Partnership's Hotel property, including all improvements
and personal property thereon and an assignment of all present and future
leases and rents. The Second Prudential Loan is also without recourse to the
limited and general partners of Justice. The principal balance of the Second
Prudential Loan was $18,202,000 as of September 30, 2010.

Effective April 29, 2010, the Partnership obtained a modification of its
$2,500,000 unsecured revolving line of credit facility with East West Bank
(formerly United Commercial Bank) that was to mature on April 30, 2010, and
converted that line of credit facility to an unsecured term loan. The
Partnership also obtained a waiver of any prior noncompliance with financial
covenants and paid a loan modification fee of $10,000.

The modification provides that Justice will pay the $2,500,000 balance on its
line of credit facility over a period of four years, to mature on April 30,
2014. This term loan calls for monthly principal and interest payments of
$41,000, calculated on a six-year amortization schedule, with interest only
from May 1, 2010 to August 31, 2010. Pursuant to the modification, the annual
floating interest rate was reduced by 0.5% to the WSJ Prime Rate plus 2.5%
(with a minimum floor rate of 5.0% per annum). The modification includes
financial covenants written to reflect financial conditions that all hotels are
facing. The covenants include specific financial ratios and a return to minimum
profitability by June 2011. Management believes that the Partnership has the
ability to meet the specific covenants and the Partnership was in compliance
with the covenants as of September 30, 2010. As of September 30, 2010 the
outstanding balance was $2,470,000.

Despite the downturns in the economy, the Hotel has continued to generate
positive cash flows. While the debt service requirements related to the two
Prudential loans, as well as the new term loan to pay off the line of credit,
may create some additional risk for the Company and its ability to generate
cash flows in the future since the Partnership's assets had been virtually debt
free for a number of years, management believes that cash flows from the
operations of the Hotel and the garage will continue to be sufficient to meet
all of the Partnership's current and future obligations and financial
requirements. Management also believes that there is sufficient equity in the
Hotel assets to support future borrowings, if necessary, to fund any new
capital improvements and other requirements.

In November 2010, the Company refinanced its $1,641,000 adjustable rate
mortgage note payable on its 27-unit apartment building for a new 10-year fixed
rate mortgage in the amount of $3,260,000. The new loan provided approximately
$1,500,000 in cash back to Woodland Village. The interest rate on the new loan

                                   -22-


is fixed at 4.85% per annum, with monthly principal and interest payments based
on a 30-year amortization schedule. The note matures in December 2020.

In November 2010, the Company also refinanced its $3,569,000 adjustable rate
mortgage note payable on its 31-unit apartment building for a new 10-year fixed
rate mortgage in the amount of $5,787,000. The new loan provided approximately
$2,069,000 in cash back to the Company. The interest rate on the new loan is
fixed at 4.85% per annum, with monthly principal and interest payments based on
a 30-year amortization schedule. The note matures in December 2020.

The Company has invested in short-term, income-producing instruments and in
equity and debt securities when deemed appropriate.  The Company's marketable
securities are classified as trading with unrealized gains and losses recorded
through the consolidated statements of operations.

Management believes that its cash, marketable securities, and the cash flows
generated from those assets and from its real estate operations, partnership
distributions and management fees, will be adequate to meet the Company's
current and future obligations.


OFF-BALANCE SHEET ARRANGEMENTS

The Company has no off balance sheet arrangements.


MATERIAL CONTRACTUAL OBLIGATIONS

The following table provides a summary of the Company's material financial
obligations which also includes interest.



                                    Total        Year 1       Year 2       Year 3        Year 4      Year 5      Thereafter
                                ------------   ----------   ----------   ----------   -----------   ----------   -----------
                                                                                            
Mortgage notes payable          $138,849,000   $5,834,000  $11,769,000  $39,521,000   $ 7,268,000   $9,055,000   $65,402,000
Other notes payable                3,966,000      926,000      708,000      694,000     1,629,000        9,000             -
Operating leases                     725,000      203,000      103,000       87,000       107,000      111,000       114,000
                                 -----------    ---------   ----------   ----------    ----------    ---------    ----------
Total                           $143,540,000   $6,963,000  $12,580,000  $40,302,000   $ 9,004,000   $9,175,000   $65,516,000
                                 ===========    =========   ==========   ==========    ==========    =========    ==========

IMPACT OF INFLATION

Hotel room rates are typically impacted by supply and demand factors, not
inflation, since rental of a hotel room is usually for a limited number of
nights.  Room rates can be, and usually are, adjusted to account for
inflationary cost increases.  Since Prism has the power and ability under the
terms of its management agreement to adjust hotel room rates on an ongoing
basis, there should be minimal impact on partnership revenues due to inflation.
Partnership revenues are also subject to interest rate risks, which may be
influenced by inflation.  For the two most recent fiscal years, the impact of
inflation on the Company's income is not viewed by management as material.

The Company's residential rental properties provide income from short-term
operating leases and no lease extends beyond one year.  Rental increases are
expected to offset anticipated increased property operating expenses.

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CRITICAL ACCOUNTING POLICIES

Critical accounting policies are those that are most significant to the
presentation of our financial position and results of operations and require
judgments by management in order to make estimates about the effect of matters
that are inherently uncertain. The preparation of these condensed financial
statements requires us to make estimates and judgments that affect the reported
amounts in our consolidated financial statements. We evaluate our estimates on
an on-going basis, including those related to the consolidation of our
subsidiaries, to our revenues, allowances for bad debts, accruals, asset
impairments, other investments, income taxes and commitments and contingencies.
We base our estimates on historical experience and on various other assumptions
that we believe to be reasonable under the circumstances, the results of which
form the basis for making judgments about the carrying values of assets and
liabilities. The actual results may differ from these estimates or our
estimates may be affected by different assumptions or conditions.


Item 4. Controls and Procedures.

EVALUATION OF DISCLOSURE CONTROLS AND PROCEDURES

The Company's management, with the participation of the Company's Chief
Executive Officer and Principal Financial Officer, has evaluated the
effectiveness of the Company's disclosure controls and procedures (as defined
in Rules 13a-15(e) and 15d-15(e) under the Exchange Act) as of the end of the
quarterly period covered by this Quarterly Report on Form 10-Q.  Based upon
such evaluation, the Chief Executive Officer and Principal Financial Officer
have concluded that, as of the end of such period, the Company's disclosure
controls and procedures are effective in ensuring that information required to
be disclosed in this filing is accumulated and communicated to management and
is recorded, processed, summarized and reported within the time periods
specified in the Securities and Exchange Commission rules and forms.

CHANGES IN INTERNAL CONTROL OVER FINANCIAL REPORTING

There have been no changes in the Company's internal control over financial
reporting during the last quarterly period covered by this Quarterly Report on
Form 10-Q that have materially affected, or are reasonably likely to materially
affect, the Company's internal control over financial reporting.


                                PART II
                           OTHER INFORMATION
Item 6.  Exhibits.

(a) Exhibits

    31.1   Certification of Chief Executive Officer of Periodic Report
            Pursuant to Rule 13a-14(a) and Rule 15d-14(a).

    31.2   Certification of Principal Financial Officer of Periodic Report
            Pursuant to Rule 13a-14(a) and Rule 15d-14(a).

    32.1   Certification of Chief Executive Officer Pursuant to 18
            U.S.C. Section 1350.

    32.2   Certification of Principal Financial Officer Pursuant to 18
            U.S.C. Section 1350.

                                   -24-


                               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 thereunto duly authorized.


                                               THE INTERGROUP CORPORATION
                                                     (Registrant)

Date: November 12, 2010               by      /s/ John V. Winfield
                                              ----------------------------
                                              John V. Winfield, President,
                                              Chairman of the Board and
                                              Chief Executive Officer


Date: November 12, 2010               by      /s/ David Nguyen
                                              ------------------------------
                                              David Nguyen, Treasurer
                                              and Controller
                                             (Principal Financial Officer)

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