UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWashington, D.C. 20549

Form 10-Q

|[X]        |  | Quarterly
      report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934 
|---------- |  | ----------------------------------------------------------------------------------------------------
|           |  | For the
      quarterly period ended**August 1, 2009**                                              
|or        
|[ 
      ] |  | Transition
      report pursuant to Section 13 or 15(d) of the Securities Exchange Act of
      1934
|           |  | For the
      transition period from __________________ to__________________                        

Commission File
      Number:
    
    0-21360


Shoe Carnival, Inc.(Exact
      name of registrant as specified in its charter)




Indiana
    
    35-1736614(State or
      other jurisdiction of
    
    (IRS
      Employer Identification Number)incorporation or organization)7500 East
      Columbia StreetEvansville, IN
    
    47715(Address of
      principal executive offices)
    
    (Zip
      code)




(812) 867-6471(Registrant's telephone number, including area
      code)**NOT APPLICABLE***(Former name, former
      address and former fiscal year, if changed since last
    report)*


Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 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 has submitted electronically and posted on its corporate website, if
any, every Interactive Data File required to be submitted and posted pursuant to
Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12
months (or for such shorter period that the registrant was required to submit
and post such files).

| | [   ]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. See definitions of "large accelerated
filer", "accelerated filer" and "smaller reporting company" in Rule 12b-2 of the
Exchange Act. (Check one):

[   ] Large accelerated
filer      [X] Accelerated
filer      [   ] Non-accelerated
filer      [   ] Smaller reporting company

Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

| | [   ]Yes |  | [X]No
| | -------- |  | -----

APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares
outstanding of each of the issuer's classes of common stock, as of the latest
practicable date.

Number of Shares of Common Stock, $.01
par value, outstanding at September 4, 2009 were 12,942,563.

---

SHOE CARNIVAL, INC.INDEX TO FORM
10-Q

|              |  |                                                                |  |                                                                   |  | Page   
|------------- |  | -------------------------------------------------------------- |  | ----------------------------------------------------------------- |  | -------
|Part
      I  |  | Financial Information                                          |  |                                                                  
|              |  | Item 1.                                                        |  | Financial Statements
      (Unaudited)                            |  |        
|              |  | Condensed Consolidated Balance
      Sheets                    |  | 3                                                                
|              |  | Condensed Consolidated Statements of
      Income              |  | 4                                                                
|              |  | Condensed Consolidated Statement of
      Shareholders' Equity |  | 5                                                                
|              |  | Condensed Consolidated Statements of Cash
      Flows          |  | 6                                                                
|              |  | Notes to Condensed Consolidated Financial
      Statements     |  | 7 - 14                                                           
|             
|              |  | Item
      2.                                                  |  | Management's Discussion and Analysis of Financial
      Condition |  |        
|              |  |                                                                |  | and Results of
      Operations                                   |  | 15 - 22
|             
|              |  | Item
      3.                                                  |  | Quantitative and Qualitative Disclosures About Market
      Risk  |  | 22     
|             
|              |  | Item
      4.                                                  |  | Controls and Procedures                                           |  | 22     
|             
|Part
      II |  | Other
      Information                                        |  |                                                                  
|              |  | Item 1.                                                        |  | Legal
Proceedings                                                 |  | 23     
|             
|              |  | Item
      1A.                                                 |  | Risk
      Factors                                                |  | 23     
|             
|              |  | Item
      4.                                                  |  | Submission of Matters to a Vote of Security
    Holders           |  | 23     
|             
|              |  | Item
      6.                                                  |  | Exhibits                                                          |  | 24 - 25
|             
|              |  | Signature                                                      |  |                                                                   |  | 26     

2

---

SHOE CARNIVAL, INC.PART I -
FINANCIAL INFORMATION

ITEM 1. FINANCIAL
STATEMENTS

SHOE CARNIVAL,
INC.CONDENSED CONSOLIDATED BALANCE
SHEETSUnaudited

|                                                             |  | August 1, |         | January 31, |  | August 2,
|------------------------------------------------------------ |  | --------- | ------- | ----------- |  | ---------
|(In thousands,
      except per share data)                  |  | 2009      |         | 2009        |  | 2008     
|Assets                                                       |  |           |         |             |  |          
|Current
      Assets:                                        |  |           |         |             |  |          
|Cash and cash equivalents                                    |  | $         | 17,673  |             |  | $        
|Accounts receivable                                          |  |           | 1,948   |             |  |          
|Merchandise inventories                                      |  |           | 216,728 |             |  |          
|Deferred income tax benefit                                  |  |           | 2,424   |             |  |          
|Other                                                        |  |           | 7,540   |             |  |          
|Total Current
      Assets                                   |  |           | 246,313 |             |  |          
|Property and equipment-net                                   |  |           | 66,054  |             |  |          
|Other                                                        |  |           | 1,627   |             |  |          
|Total Assets                                                 |  | $         | 313,994 |             |  | $        
|                                                             | 
|Liabilities and Shareholders' Equity                         |  |           |         |             |  |          
|Current
      Liabilities:                                   |  |           |         |             |  |          
|Accounts payable                                             |  | $         | 73,475  |             |  | $        
|Accrued and other liabilities                                |  |           | 13,712  |             |  |          
|Total Current Liabilities                                    |  |           | 87,187  |             |  |          
|Deferred lease
      incentives                              |  |           | 5,791   |             |  |          
|Accrued rent                                                 |  |           | 5,155   |             |  |          
|Deferred income
      taxes                                  |  |           | 905     |             |  |          
|Deferred compensation                                        |  |           | 3,187   |             |  |          
|Other                                                        |  |           | 1,858   |             |  |          
|Total Liabilities                                            |  |           | 104,083 |             |  |          
|                                                             | 
|Shareholders' Equity:                                        |  |           |         |             |  |          
|Common stock, $.01 par value, 50,000
    shares              |  |           |         |             |  |          
|authorized, 13,655, 13,664 and 13,664 shares
      issued at |  |           |         |             |  |          
|August 1, 2009, January 31, 2009 and August 2,
      2008,   |  |           |         |             |  |          
|respectively                                                 |  |           | 137     |             |  |          
|Additional paid-in capital                                   |  |           | 67,428  |             |  |          
|Retained earnings                                            |  |           | 158,980 |             |  |          
|Treasury stock, at cost, 726, 745 and 1,045 shares at        |  |           |         |             |  |          
|August 1, 2009, January 31, 2009 and August 2,
      2008,   |  |           |         |             |  |          
|respectively                                                 |  |           | (16,634 | )           |  |          
|Total
      Shareholders' Equity                             |  |           | 209,911 |             |  |          
|Total Liabilities and Shareholders' Equity                   |  | $         | 313,994 |             |  | $        

See notes to condensed consolidated
financial statements.

3

---

SHOE CARNIVAL,
INC.CONDENSED CONSOLIDATED STATEMENTS
OF INCOMEUnaudited

|                                            |  | Thirteen    |         | Thirteen    |  | Twenty-six  |         | Twenty-six 
|------------------------------------------- |  | ----------- | ------- | ----------- |  | ----------- | ------- | -----------
|                                            |  | Weeks Ended |         | Weeks Ended |  | Weeks Ended |         | Weeks Ended
|                                            |  | August 1,   |         | August 2,   |  | August 1,   |         | August 2,  
|(In thousands, except per share
      data) |  | 2009        |         | 2008        |  | 2009        |         | 2008       
|Net
      sales                             |  | $           | 152,840 |             |  | $           | 158,480 |            
|Cost of sales (including
      buying,      |  |             |         |             |  |             |         |            
|distribution and occupancy
      costs)     |  |             | 111,916 |             |  |             | 116,334 |            
|Gross
      profit                          |  |             | 40,924  |             |  |             | 42,146  |            
|Selling, general and
      administrative   |  |             |         |             |  |             |         |            
|expenses                                    |  |             | 39,020  |             |  |             | 40,661  |            
|Operating income                            |  |             | 1,904   |             |  |             | 1,485   |            
|Interest income                             |  |             | (1      | )           |  |             | (39     | )          
|Interest expense                            |  |             | 42      |             |  |             | 36      |            
|Income before income
      taxes            |  |             | 1,863   |             |  |             | 1,488   |            
|Income tax expense                          |  |             | 881     |             |  |             | 511     |            
|Net income                                  |  | $           | 982     |             |  | $           | 977     |            
|                                           
|Net
      income per share:                 |  |             |         |             |  |             |         |            
|Basic                                       |  | $           | .08     |             |  | $           | .08     |            
|Diluted                                     |  | $           | .08     |             |  | $           | .08     |            
|                                           
|Average shares outstanding:                 |  |             |         |             |  |             |         |            
|Basic                                       |  |             | 12,487  |             |  |             | 12,367  |            
|Diluted                                     |  |             | 12,569  |             |  |             | 12,463  |            

See notes to condensed consolidated
financial statements.

4

---

SHOE CARNIVAL,
INC.CONDENSED CONSOLIDATED STATEMENT
OF SHAREHOLDERS' EQUITYUnaudited

|                                   |  |              |        |          |  |          |      |          |  |          |     |       | Additional |        |   |  |   |         |  |   |         |   |  |  
|---------------------------------- |  | ------------ | ------ | -------- |  | -------- | ---- | -------- |  | -------- | --- | ----- | ---------- | ------ | - |  | - | ------- |  | - | ------- | - |  | -
|                                   |  | Common Stock |        | Paid-In  |  | Retained |      | Treasury |  |          |     |      
|(In thousands)                     |  | Issued       |        | Treasury |  | Amount   |      | Capital  |  | Earnings |     | Stock |            | Total 
|Balance at January 31, 2009        |  |              | 13,664 |          |  |          | (745 | )        |  | $        | 137 |       | $          | 67,686 |   |  | $ | 153,866 |  | $ | (17,053 | ) |  | $
|Stock option
      exercises       |  |              |        |          |  |          | 5    |          |  |          |     |       |            | (93    | ) |  |   |         |  |   | 115     |   |  |  
|Stock-based compensation           |  |              |        |          |  |          |      |          |  |          |     |       |            |        |   |  |   |         |  |   |         |   |  |  
|income tax benefit                 |  |              |        |          |  |          |      |          |  |          |     |       |            | 57     |   |  |   |         |  |   |         |   |  |  
|Employee stock purchase
      plan |  |              |        |          |  |          |      |          |  |          |     |       |            |        |   |  |   |         |  |   |         |   |  |  
|purchases                          |  |              |        |          |  |          | 10   |          |  |          |     |       |            | (122   | ) |  |   |         |  |   | 206     |   |  |  
|Restricted stock awards            |  |              | (9     | )        |  |          | 4    |          |  |          |     |       |            | (98    | ) |  |   |         |  |   | 98      |   |  |  
|Stock-based
      compensation     |  |              |        |          |  |          |      |          |  |          |     |       |            |        |   |  |   |         |  |   |         |   |  |  
|income                             |  |              |        |          |  |          |      |          |  |          |     |       |            | (2     | ) |  |   |         |  |   |         |   |  |  
|Net
      income                   |  |              |        |          |  |          |      |          |  |          |     |       |            |        |   |  |   | 5,114   |  |   |         |   |  |  
|Balance at August 1,
      2009    |  |              | 13,655 |          |  |          | (726 | )        |  | $        | 137 |       | $          | 67,428 |   |  | $ | 158,980 |  | $ | (16,634 | ) |  | $

See notes to condensed consolidated
financial statements.

5

---

SHOE CARNIVAL, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH
FLOWSUnaudited

|                                                                               |  | Twenty-six  |         | Twenty-six 
|------------------------------------------------------------------------------ |  | ----------- | ------- | -----------
|                                                                               |  | Weeks Ended |         | Weeks Ended
|                                                                               |  | August 1,   |         | August 2,  
|(In thousands)                                                                 |  | 2009        |         | 2008       
|Cash
      Flows From Operating Activities                                     |  |             |         |            
|Net income                                                                     |  | $           | 5,114   |            
|Adjustments to reconcile net income
      to net                               |  |             |         |            
|cash (used in)
      provided by operating activities:                         |  |             |         |            
|Depreciation and
      amortization                                            |  |             | 7,590   |            
|Stock-based
      compensation                                                 |  |             | 220     |            
|Loss on retirement
      and impairment of assets                              |  |             | 57      |            
|Deferred income
      taxes                                                    |  |             | (358    | )          
|Lease
      incentives                                                         |  |             | 715     |            
|Other                                                                          |  |             | (320    | )          
|Changes in operating
      assets and liabilities:                             |  |             |         |            
|Accounts
      receivable                                                      |  |             | (241    | )          
|Merchandise
      inventories                                                  |  |             | (27,234 | )          
|Accounts payable and
      accrued liabilities                                 |  |             | 15,045  |            
|Other                                                                          |  |             | (2,538  | )          
|Net
      cash (used in) provided by operating activities                      |  |             | (1,950  | )          
|                                                                              
|Cash
      Flows From Investing Activities                                     |  |             |         |            
|Purchases of property and
      equipment                                      |  |             | (5,474  | )          
|Proceeds from sale of property and
      equipment                             |  |             | 8       |            
|Proceeds from note
    receivable                                              |  |             | 100     |            
|Net
      cash used in investing activities                                    |  |             | (5,366  | )          
|                                                                              
|Cash
      Flows From Financing Activities                                     |  |             |         |            
|Borrowings under line of
    credit                                            |  |             | 0       |            
|Payments on line of
      credit                                               |  |             | 0       |            
|Proceeds from
      issuance of stock                                          |  |             | 106     |            
|Excess tax benefits
      from stock-based compensation                        |  |             | 66      |            
|Net cash provided by
      financing activities                                |  |             | 172     |            
|Net
      (decrease) increase in cash and cash equivalents                     |  |             | (7,144  | )          
|Cash and cash equivalents
      at beginning of period                         |  |             | 24,817  |            
|Cash
      and Cash Equivalents at End of Period                               |  | $           | 17,673  |            
|                                                                              
|Supplemental disclosures of cash flow information:                             |  |             |         |            
|Cash paid during period for
      interest                                     |  | $           | 83      |            
|Cash paid during period for income
      taxes                                 |  | $           | 180     |            
|Capital expenditures incurred but not
      yet paid                           |  | $           | 912     |            
|                                                                              
|Supplemental disclosures of non-cash operating and investing
      activities: |  |             |         |            
|Forgiveness of accounts payable from
      litigation settlement (1)           |  | $           | 1,160   |            
|Recording of note receivable from
      litigation settlement (1)              |  | $           | 1,200   |            

|(1) |  | See Note 5  Litigation Matters for details of the
      settlement. Cumulative settlement served to reduce the value of originally
      acquired assets.
|--- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------

See notes to condensed consolidated
financial statements.

6

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SHOE CARNIVAL, INC.NOTES TO CONDENSED CONSOLIDATED
FINANCIAL STATEMENTSUnaudited

Note 1 - Basis of
Presentation

In our opinion, the accompanying
unaudited condensed consolidated financial statements contain all adjustments
necessary to present fairly our financial position and the results of our
operations and our cash flows for the periods presented. Certain information and
disclosures normally included in the notes to consolidated financial statements
have been condensed or omitted according to the rules and regulations of the
Securities and Exchange Commission (the "SEC"), although we believe that the
disclosures are adequate to make the information presented not misleading. The
results of operations for the interim periods are not necessarily indicative of
the results to be expected for the full year. The condensed consolidated
financial statements should be read in conjunction with the audited consolidated
financial statements and the notes thereto contained in our Annual Report on
Form 10-K for the fiscal year ended January 31, 2009.

We determined that certain deposits and
pre-paid expenses totaling $1.6 million as of August 1, 2009 would not be
utilized within the next 12 months and should be classified as long-term.
Therefore, we have presented these amounts as Other in the long-term section of
our condensed consolidated balance sheet. Similar assets in the amount of
$400,000 and $463,000 as of January 31, 2009 and August 2, 2008, respectively,
that had previously been classified as Other within Current Assets have been
presented as long-term in the accompanying comparative condensed consolidated
balance sheets.

Note 2 - Net Income Per
Share

Net income per share of common stock is
based on the weighted average number of shares and common share equivalents
outstanding during the period. The following table presents a reconciliation of
our basic and diluted weighted average common shares outstanding as required by
Statement of Financial Accounting Standards ("SFAS") No. 128, "Earnings Per
Share":

|                                            | Thirteen    |  | Thirteen    |  | Twenty-six  |  | Twenty-six 
|------------------------------------------- | ----------- |  | ----------- |  | ----------- |  | -----------
|                                            | Weeks Ended |  | Weeks Ended |  | Weeks Ended |  | Weeks Ended
|                                            | August 1,   |  | August 2,   |  | August 1,   |  | August 2,  
|(In thousands)                              | 2009        |  | 2008        |  | 2009        |  | 2008       
|Basic
      shares                          | 12,487      |  | 12,367      |  | 12,483      |  | 12,360     
|Dilutive effect of
      stock-based awards | 82          |  | 96          |  | 60          |  | 95         
|Diluted shares                              | 12,569      |  | 12,463      |  | 12,543      |  | 12,455     

Options to purchase 410,400 shares of
common stock for the second quarter of fiscal 2009 and options to purchase
413,200 shares of common stock for the first six months of fiscal 2009 were not
included in the computation of diluted shares because the options' exercise
prices were greater than the average market price of our common stock for the
period. Options to purchase 227,100 shares of common stock for the second
quarter of fiscal 2008 and options to purchase 220,300 shares of common stock
for the first six months of fiscal 2008 were not included in the computation of
diluted shares because the options' exercise prices were greater than the
average market price of our common stock for the period.

Note 3  Recently Issued Accounting
Pronouncements

In September 2006, the Financial
Accounting Standards Board (the "FASB") issued SFAS No. 157, "Fair Value
Measurements" ("SFAS No. 157"). SFAS No. 157 defines fair value, establishes a
framework for measuring fair value in generally accepted accounting principles,
and expands disclosures about fair value measurements. The provisions of SFAS
No. 157 are effective for fiscal years beginning after November 15, 2007. In
February 2008, the FASB deferred the implementation of SFAS No. 157 for certain
non-financial assets and liabilities for fiscalyears beginning after November 15, 2008. We adopted the provisions of
SFAS No. 157 for financial assets and liabilities on February 3, 2008 and
adopted the provisions of SFAS No. 157 for non-financial assets and liabilities
on February 1, 2009. The adoption of SFAS No. 157 did not have a material impact
on our condensed consolidated financial statements. See Note 6  "Fair Value
Measurements" to our notes to condensed consolidated financial statements.

7

---

In December 2007, the FASB issued SFAS
No. 141R, "Business Combinations" ("SFAS No. 141R"). SFAS No. 141R requires an
acquirer to recognize the assets acquired, the liabilities assumed, and any
non-controlling interest in the acquired business at the acquisition date,
measured at their full fair values as of that date. We adopted the provisions of
SFAS No. 141R on February 1, 2009. The adoption of SFAS No. 141R did not have a
material impact on our condensed consolidated financial statements.

In April 2008, the FASB issued
Financial Statement of Position ("FSP") No. FAS 142-3, "Determination of the
Useful Life of Intangible Assets" ("FSP No. FAS 142-3"), which amends the
factors that should be considered in developing renewal or extension assumptions
used to determine the useful life of a recognized intangible asset under FASB
Statement No. 142, "Goodwill and Other Intangible Assets". FSP No. FAS 142-3
allows an entity to use its own historical experience in renewing or extending
similar arrangements, adjusted for specified entity-specific factors, in
developing assumptions about renewal or extension used to determine the useful
life of a recognized intangible asset. Additional disclosures are required to
enable financial statement users to assess the extent to which the expected
future cash flows associated with the asset are affected by the entitys intent
and/or ability to renew or extend the arrangement. The guidance for determining
the useful life of a recognized intangible asset is to be applied prospectively
to intangible assets acquired after the effective date. The disclosure
requirements are to be applied prospectively to all intangible assets recognized
as of, and subsequent to, the effective date. We adopted the provisions of FSP
No. FAS 142-3 on February 1, 2009. The adoption of FSP No. FAS 142-3 did not
have a material impact on our condensed consolidated financial
statements.

In April 2009, the FASB issued FSP No.
FAS 157-4, "Determining Fair Value When the Volume and Level of Activity for the
Asset or Liability Have Significantly Decreased and Identifying Transactions
That Are Not Orderly" ("FSP No. FAS 157-4"). FSP No. FAS 157-4 indicates that
when determining the fair value of an asset or liability that is not a Level 1
fair value measurement, an entity should assess whether the volume and level of
activity for the asset or liability have significantly decreased when compared
with normal market conditions. If the entity concludes that there has been a
significant decrease in the volume and level of activity, a quoted price (e.g.,
observed transaction) may not be determinative of fair value and may require a
significant adjustment. The adoption of FSP No. FAS 157-4 during the second
quarter of fiscal 2009 did not have a material impact on our condensed
consolidated financial statements.

In April 2009, the FASB issued FSP No.
FAS 115-2 and FAS 124-2, "Recognition and Presentation of Other-Than-Temporary
Impairments" ("FSP No. FAS 115-2 and FAS 124-2"). FSP No. FAS 115-2 and FAS
124-2 modifies the requirements for recognizing other-than-temporarily impaired
debt securities and changes the existing impairment model for such securities.
It also modifies the presentation of other-than-temporary impairment losses and
increases the frequency of and expands already required disclosures about
other-than-temporary impairment for debt and equity securities. The adoption of
FSP No. FAS 115-2 and FAS 124-2 during the second quarter of fiscal 2009 did not
have a material impact on our condensed consolidated financial statements.

In April 2009, the FASB issued FSP No.
FAS 107-1 and APB 28-1, "Interim Disclosures about Fair Value of Financial
Instruments" ("FSP No. FAS 107-1 and APB 28-1"). FSP No. FSP FAS 107-1 and APB
28-1 requires publicly traded companies, as defined in Opinion No. 28, to
disclose the fair value of financial instruments within the scope of FAS No. 107
in interim financial statements, adding to the current requirement to make those
disclosures in annual financial statements. This staff position also requires
that companies disclose the method or methods and significant assumptions used
to estimate the fair value of financial instruments and a discussion of changes,
if any, in the method or methods and significant assumptions during the period.
The adoption of FSP No. FAS 107-1 and APB 28-1 during the second quarter of
fiscal 2009 did not have a material impact on our condensed consolidated
financial statements.

8

---

In May 2009, the FASB issued SFAS No.
165, "Subsequent Events" ("SFAS No. 165). SFAS No. 165 sets forth: 1) the period
after the balance sheet date during which management of a reporting entity
should evaluate events or transactions that may occur for potential recognition
or disclosure in the financial statements; 2) the circumstances under which an
entity should recognize events or transactions occurring after the balance sheet
date in its financial statements; and 3) the disclosures that an entity should
make about events or transactions that occurred after the balance sheet date.
SFAS No. 165 is effective for interim and annual periods ending after June 15,
2009. Subsequent events were evaluated through September 10, 2009, the date on
which the financial statements were issued. This assessment of subsequent events
did not reveal the occurrence of any material events or transactions.

Note 4 - Stock-Based Compensation

Stock Options

The following table summarizes the
stock option transactions pursuant to the stock-based compensation plans for the
twenty-six week period ended August 1, 2009:

|                                             |           |   |                |           |              |           | Weighted-         |           |   |    
|-------------------------------------------- | --------- | - | -------------- | --------- | ------------ | --------- | ----------------- | --------- | - | ---
|                                             |           |   |                |           |              |           | Average           |           |   |    
|                                             |           |   |                | Weighted- |              | Remaining |                   | Aggregate
|                                             | Number of |   | Average        |           | Contractual  |           | Intrinsic
  Value
|                                             | Shares    |   | Exercise Price |           | Term (Years) |           | (in thousands)   
|Outstanding at January 31, 2009              | 526,168   |   |                | $         | 12.77        |           |                   |           |   |    
|Grants                                       | 0         |   |                |           | 0.00         |           |                   |           |   |    
|Forfeited or
    expired                     | (8,000    | ) |                |           | 11.91        |           |                   |           |   |    
|Exercised                                    | (5,000    | ) |                |           | 4.38         |           |                   |           |   |    
|Outstanding August 1,
      2009             | 513,168   |   |                | $         | 12.87        |           | 3.40              |           | $ | 671
|Options outstanding at
      August 1, 2009, |           |   |                |           |              |           |                   |           |   |    
|net of estimated forfeitures                 | 511,319   |   |                | $         | 12.87        |           | 3.38              |           | $ | 670
|Exercisable at August 1, 2009                | 479,001   |   |                | $         | 12.88        |           | 3.03              |           | $ | 649

The total fair value at grant date of
previously non-vested stock options that vested during the twenty-six week
periods ended August 1, 2009 and August 2, 2008 were $32,000 and $6,000,
respectively.

No stock options were granted during
the first half of fiscal 2009. The weighted-average fair value of options
granted was $6.46 during the first half of fiscal 2008. The fair value of
options granted during the first half of fiscal 2008 was estimated at grant date
using a Black-Scholes option-pricing model with the following weighted-average
assumptions:

2008Risk
      free interest rate
    3.1
    %Expected dividend
      yield
    0.0
    %Expected volatility
    45.39
    %Expected term
    5 Years


The risk free interest rate was based
on the U.S. Treasury yield curve in effect at the time of the grant. We had not
paid and did not anticipate paying cash dividends; therefore, the expected
dividend yield was assumed to be zero. Expected volatility was based on the
historical volatility of our stock. The expected term of the options was based
on our historical option exercise data taking into consideration the exercise
and forfeiture patterns of the class of option holders during the options life.

9

---

The following table summarizes
information regarding options exercised:

|                                      | Thirteen    |        | Thirteen    |   | Twenty-six  |  | Twenty-six 
|------------------------------------- | ----------- | ------ | ----------- | - | ----------- |  | -----------
|                                      | Weeks Ended |        | Weeks Ended |   | Weeks Ended |  | Weeks Ended
|                                      | August 1,   |        | August 2,   |   | August 1,   |  | August 2,  
|                                      | 2009        |        | 2008        |   | 2009        |  | 2008       
|Total
      intrinsic value (1)       | $           | 38,000 |             | $ | 0           |  | $          
|Total cash
    received               | $           | 22,000 |             | $ | 0           |  | $          
|Associated excess income tax benefits |             |        |             |   |             |  |            
|recorded                              | $           | 66,000 |             | $ | 0           |  | $          

|(1) |  | Defined as the difference between
      the market value at exercise and the grant price of stock options
      exercised.
|--- |  | --------------------------------------------------------------------------------------------------------------------------

The following table summarizes
information regarding outstanding and exercisable options at August 1, 2009:

|               |               |             | Options Outstanding |                | Options Exercisable
|-------------- | ------------- | ----------- | ------------------- | -------------- | -------------------
|               |               |             | Number              |                | Weighted           
|Range of       |               | of Options  |                     | Average        |                    
|Exercise Price |               | Outstanding |                     | Remaining Life |                    
|$              | 4.38  5.75   |             | 56,162              |                | 1.33               
|$              | 8.56  12.14  |             | 102,585             |                | 4.06               
|$              | 12.67  16.30 |             | 196,801             |                | 4.23               
|$              | 17.12         |             | 157,620             |                | 2.67               

The following table summarizes
information regarding stock-based compensation expense recognized for non-vested
options:

|                                        | Thirteen    |        | Thirteen    |   | Twenty-six  |  | Twenty-six 
|--------------------------------------- | ----------- | ------ | ----------- | - | ----------- |  | -----------
|                                        | Weeks Ended |        | Weeks Ended |   | Weeks Ended |  | Weeks Ended
|                                        | August 1,   |        | August 2,   |   | August 1,   |  | August 2,  
|                                        | 2009        |        | 2008        |   | 2009        |  | 2008       
|Stock-based compensation expense before |             |        |             |   |             |  |            
|the recognized income tax
      benefit | $           | 19,000 |             | $ | 22,000      |  | $          
|Income tax
    benefit                  | $           | 9,000  |             | $ | 8,000       |  | $          

As of August 1, 2009, there was
approximately $120,500 of unrecognized compensation expense, net of estimated
forfeitures, remaining related to non-vested stock options. This expense is
expected to be recognized over a weighted-average period of 1.8 years.

Restricted Stock
Awards

The following table summarizes the
restricted share transactions for the twenty-six week period ended August 1,
2009:

|                               |           |   |                 | Weighted-
|------------------------------ | --------- | - | --------------- | ---------
|                               | Number of |   | Average Grant  
|                               | Shares    |   | Date Fair Value
|Non-vested at January 31, 2009 | 434,234   |   |                 | $        
|Granted                        | 4,284     |   |                 |          
|Released                       | (1,034    | ) |                 |          
|Forfeited                      | (1,500    | ) |                 |          
|Non-vested at August 1, 2009   | 435,984   |   |                 | $        

10

---

The total fair value at grant date of
previously non-vested stock awards that vested during the first half of fiscal
2009 was $12,900. No previously non-vested stock awards vested during the first
half of fiscal 2008. The weighted-average grant date fair values of stock awards
granted during the twenty-six week periods ended August 1, 2009 and August 2,
2008 were $12.26 and $12.50, respectively.

The following table summarizes
information regarding stock-based compensation expense (income) for restricted
stock awards:

|                                            | Thirteen    |         | Thirteen    |   | Twenty-six  |  | Twenty-six 
|------------------------------------------- | ----------- | ------- | ----------- | - | ----------- |  | -----------
|                                            | Weeks Ended |         | Weeks Ended |   | Weeks Ended |  | Weeks Ended
|                                            | August 1,   |         | August 2,   |   | August 1,   |  | August 2,  
|                                            | 2009        |         | 2008        |   | 2009        |  | 2008       
|Stock-based compensation expense            |             |         |             |   |             |  |            
|(income) before the recognized
      income |             |         |             |   |             |  |            
|tax benefit                                 | $           | 305,000 |             | $ | 296,100     |  | $          
|Income tax benefit
      (expense)          | $           | 144,000 |             | $ | 101,700     |  | $          

The $57,000 of income recorded during
the first half of fiscal 2009 was comprised of compensation expense of $596,000
offset by income of $653,000. The income was attributable to the first quarter
reversal of the cumulative prior period expense for performance-based awards
which now have been deemed by management as not probable of vesting.

As of August 1, 2009, there was
approximately $3.5 million of unrecognized compensation expense remaining
related to both the performance-based and service-based non-vested stock awards.
The expense is expected to be recognized over a weighted average period of 2.8
years. This incorporates the current assumptions of the estimated requisite
service period required to achieve the designated performance conditions for
performance-based stock awards.

Cash-Settled Stock Appreciation
Rights (SARs)

Cash-settled stock appreciation rights
(SARs) were granted to non-executive employees in the fourth quarter of fiscal
2008 such that one-third of the shares underlying the SARs granted would vest
and become fully exercisable on each of the first three anniversaries of the
date of the grant and were assigned a five-year term from the date of grant.
Each SAR entitles the holder, upon exercise, to receive cash in the amount equal
to the closing price of our stock on the date of exercise less the exercise
price. The maximum amount paid, however, cannot exceed 100% of the exercise
price. In accordance with SFAS No. 123 (revised 2004), "Share-Based Payment"
("SFAS No. 123R"), cash-settled SARs are classified as Accrued and other
liabilities on the condensed consolidated balance sheet as of August 1, 2009 and
January 31, 2009.

No previously non-vested SARs vested
nor were any SARs granted during the first half of fiscal 2009. The total number
of non-vested SARs and the weighted-average exercise price at both January 31,
2009 and August 1, 2009 was 157,000 and $9.72, respectively. The
weighted-average remaining contractual term for non-vested SARs at August 1,
2009 was 4.4 years.

11

---

SFAS No. 123R requires the fair value
of these liability awards be remeasured at each reporting period until the date
of settlement. Increases or decreases in compensation expense are recognized
over the vesting period, or immediately for vested awards. The weighted-average
fair value of outstanding, non-vested SARs awards was $4.15 as of August 1,
2009. The fair value was estimated using a trinomial lattice model with the
following assumptions:

August 1, 2009Risk
      free interest rate yield curve
    0.14% - 2.53%Expected dividend
      yield
    0.0%Expected volatility
    59.34%Maximum life
    4.38 YearsExercise multiple
    1.7Maximum payout
    $9.72Employee exit rate
    2.2% -
  9.0%


The risk free interest rate was based
on the U.S. Treasury yield curve in effect at the end of the reporting period.
We had not paid and did not anticipate paying cash dividends; therefore, the
expected dividend yield was assumed to be zero. Expected volatility was based on
the historical volatility of our stock. The exercise multiple and employee exit
rate are based on historical option data.

The following table summarizes
information regarding stock-based compensation expense recognized for SARs:

|                                                             | Thirteen    |         | Twenty-six 
|------------------------------------------------------------ | ----------- | ------- | -----------
|                                                             | Weeks Ended |         | Weeks Ended
|                                                             | August 1,   |         | August 1,  
|                                                             | 2009        |         | 2009       
|Stock-based compensation expense before the
      recognized |             |         |            
|income tax
    benefit                                       | $           | 119,000 |            
|Income tax
    benefit                                       | $           | 56,000  |            

As of August 1, 2009, there was
approximately $390,000 in unrecognized compensation expense related to
non-vested SARs. The expense is expected to be recognized over a
weighted-average period of 1.38 years.

Employee Stock Purchase
Plan

The following table summarizes
information regarding stock-based compensation expense recognized for the
employee stock purchase plan:

|                                            | Thirteen    |       | Thirteen    |   | Twenty-six  |  | Twenty-six 
|------------------------------------------- | ----------- | ----- | ----------- | - | ----------- |  | -----------
|                                            | Weeks Ended |       | Weeks Ended |   | Weeks Ended |  | Weeks Ended
|                                            | August 1,   |       | August 2,   |   | August 1,   |  | August 2,  
|                                            | 2009        |       | 2008        |   | 2009        |  | 2008       
|Stock-based compensation expense before     |             |       |             |   |             |  |            
|the recognized
      income tax benefit (1) | $           | 6,000 |             | $ | 9,500       |  | $          
|Income tax
    benefit                      | $           | 3,000 |             | $ | 3,300       |  | $          

|(1) |  | Amounts are
      representative of the 15% discount employees are provided for purchases
      under the employee stock purchase plan.
|--- |  | ---------------------------------------------------------------------------------------------------------------------------------------

Note 5 - Litigation Matters

On or about April 22, 2008, an
arbitration claim was filed by SDI Industries, Inc. ("SDI") against us with the
American Arbitration Association Western Case Management Center in Los Angeles,
California, captioned SDI Industries, Inc.
(Claimant and Counter-Respondent) v. Shoe Carnival, Inc. (Respondent and
Counterclaimant), in which SDI sought payment of $1.2
million of unpaid retainage, $700,000 for services not yet billed, plus
additional interest and legal fees. The retainage was withheld from progress
billings for work performed on our distribution center and was recorded in
accrued and other liabilities and fixed assets in our consolidated financial
statements. We filed a Counterclaim and Response in this matter, denying SDI's
claim, and seeking monetary damages of more than $3.0 million. We asserted that
SDI breached our contract with SDI ("Contract") due to its failure to deliver
our distribution center's material handling system pursuant to the
specifications of the Contract.

12

---

On May 30, 2009, the parties entered
into a settlement of the above matter. Under the terms of the settlement, SDI
agreed to forego collection of the $1.2 million in unpaid retainage and to pay
us $1.2 million towards the remediation of the distribution center's material
handling system. The $1.2 million will be paid in installments over seven years
and is evidenced by a promissory note secured by a standby letter of credit,
renewable annually, in an amount not less than $200,000 and by a security
interest in SDI's accounts receivable. In addition, both parties agreed to the
dismissal of all pending claims currently under arbitration. The installment due
on the promissory note within the next 12 months has been recorded in Accounts
receivable in our consolidated financial statements. The remaining balance of
the promissory note is recorded in Other as a non-current asset. SDI remitted
the first scheduled payment prior to the due date of July 1, 2009.

Although the investment we made in the
distribution center will satisfy our distribution needs throughout fiscal 2009,
we have not achieved the productivity that we expect will be required based on
our plan for long-term store growth. We have contracted with another
distribution logistics company to provide recommendations to improve throughput
and will implement certain of these recommendations in the second half of fiscal
2009 and also possibly in fiscal 2010.

We are involved in various other legal
proceedings incidental to the conduct of our business. While the outcome of any
legal proceeding is always uncertain, we do not currently expect that any such
proceedings will have a material adverse effect on our financial position or
results of operations.

Note 6 - Fair Value Measurements

As of February 1, 2009, SFAS No. 157
applies to both our financial and non-financial assets and liabilities. Although
the adoption of SFAS No. 157 had no impact on our financial position or results
of operations, it does result in additional disclosures regarding fair value
measurements.

SFAS No. 157 provides guidance for
using fair value to measure assets and liabilities and only applies when other
standards require or permit the fair value measurement of assets and
liabilities. It does not expand the use of fair value measurements. SFAS No. 157
establishes a fair value hierarchy, which prioritizes the inputs used in
measuring fair value into three broad levels.

- Level 1  Quoted prices in active markets that are unadjusted and
  accessible at the measurement date for identical, unrestricted assets or
  liabilities;
- Level 2  Quoted prices for identical
  assets and liabilities in markets that are not active, quoted prices for
  similar assets and liabilities in active markets or financial instruments for
  which significant inputs are observable, either directly or indirectly;
  and
- Level 3  Prices or valuations that
  require inputs that are both significant to the fair value measurement and
  unobservable.

Our financial assets as of August 1,
2009, January 31, 2009, and August 2, 2008 included cash and cash equivalents.
We did not have any financial liabilities measured at fair value for these
periods. The carrying value of cash and cash equivalents approximates fair value
due to its short-term nature and is considered a Level 1 fair value
measurement.

13

---

The following table summarizes our cash
and cash equivalents that are measured at fair value on a recurring basis as of
August 1, 2009, January 31, 2009, and August 2, 2008:

|                                          | Quoted Prices     |        | Significant |   |              |  |                  |   | 
|----------------------------------------- | ----------------- | ------ | ----------- | - | ------------ |  | ---------------- | - | 
|                                          | in Active
Markets |        | Other       |   | Significant  |  |                  |  
|                                          | for               |        | Observable  |   | Unobservable |  |                  |  
|                                          | Identical Assets  |        | Inputs      |   | Inputs       |  |                  |  
|(In thousands)                            | (Level 1)         |        | (Level 2)   |   | (Level 3)    |  | Total Fair Value
|As of
      August 1, 2009                |                   |        |             |   |              |  |                  |   | 
|Cash
    (1)                              | $                 | 9,530  |             | $ | 0            |  | $                | 0 | 
|Credit and debit card receivables (2)     |                   | 8,143  |             |   | 0            |  |                  | 0 | 
|                                          | $                 | 17,673 |             | $ | 0            |  | $                | 0 | 
|As of
      January 31, 2009              |                   |        |             |   |              |  |                  |   | 
|Cash and short-term
      investments (1) | $                 | 20,920 |             | $ | 0            |  | $                | 0 | 
|Credit and debit card receivables (2)     |                   | 3,897  |             |   | 0            |  |                  | 0 | 
|                                          | $                 | 24,817 |             | $ | 0            |  | $                | 0 | 
|As of
      August 2, 2008                |                   |        |             |   |              |  |                  |   | 
|Cash and short-term
      investments (1) | $                 | 7,011  |             | $ | 0            |  | $                | 0 | 
|Credit and debit card receivables (2)     |                   | 9,648  |             |   | 0            |  |                  | 0 | 
|                                          | $                 | 16,659 |             | $ | 0            |  | $                | 0 | 

|(1) | Cash and short-term investments
      represents cash deposits and short-term investments held with financial
      institutions. The cash balances held in bank operating accounts are
      covered by the Federal Deposit Insurance Corporation Transaction Account
      Guarantee Program. Through the end of the period, non-interest bearing
      checking accounts and certain low interest transaction accounts are fully
      guaranteed for the entire amount in the account. To date, we have
      experienced no loss or lack of access to either invested cash or cash held
      in our operating accounts. Short-term investments consist of investments
      in a money market account and commercial paper that accrue interest on a
      periodic basis.
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Our credit and debit card
      receivables are highly liquid financial assets that typically settle in
      less than three days.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             

We did not have any fair value
measurements for our non-financial assets and liabilities during the quarter or
first half of fiscal 2009.

14

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|ITEM
2. | MANAGEMENT'S DISCUSSION AND
      ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
|------- | -------------------------------------------------------------------------------------------

Factors That May Effect Future
Results

This Quarterly Report on Form 10-Q
contains forward-looking statements, within the meaning of the Private
Securities Litigation Reform Act of 1995, that involve a number of risks and
uncertainties. A number of factors could cause our actual results, performance,
achievements or industry results to be materially different from any future
results, performance or achievements expressed or implied by these
forward-looking statements. These factors include, but are not limited to:
general economic conditions in the areas of the United States in which our
stores are located; the effects and duration of the current economic downturn
and the ailing credit markets; changes in the overall retail environment and
more specifically in the apparel and footwear retail sectors; our ability to
generate increased sales at our stores; the potential impact of national and
international security concerns on the retail environment; changes in our
relationships with key suppliers; the impact of competition and pricing; changes
in weather patterns, consumer buying trends and our ability to identify and
respond to emerging fashion trends; the impact of disruptions in our
distribution or information technology operations; the effectiveness of our
inventory management; the impact of hurricanes or other natural disasters on our
stores, as well as on consumer confidence and purchasing in general; risks
associated with the seasonality of the retail industry; our ability to
successfully execute our growth strategy, including the availability of
desirable store locations at acceptable lease terms, our ability to open new
stores in a timely and profitable manner and the availability of sufficient
funds to implement our growth plans; higher than anticipated costs associated
with the closing of underperforming stores; the inability of manufacturers to
deliver products in a timely manner; changes in the political and economic
environments in the Peoples Republic of China, Brazil, Spain and East Asia, the
primary manufacturers of footwear; and the continued favorable trade relations
between the United States and China and the other countries which are the major
manufacturers of footwear. For a more detailed discussion of certain risk
factors see the "Risk Factors" section of our Annual Report on Form 10-K for the
fiscal year ended January 31, 2009.

General

Managements Discussion and Analysis of
Financial Condition and Results of Operations is intended to provide information
to assist the reader in better understanding and evaluating our financial
condition and results of operations. We encourage you to read this in
conjunction with our condensed consolidated financial statements and the notes
to those statements included in PART I, ITEM 1. FINANCIAL STATEMENTS of this
Quarterly Report on Form 10-Q, as well as our Annual Report on Form 10-K for the
fiscal year ended January 31, 2009 as filed with the SEC.

Overview of Our
Business

Shoe Carnival, Inc. is one of the
nations largest family footwear retailers. As of August 1, 2009, we operated
314 stores in 29 states primarily in the Midwest, South and Southeast regions of
the United States. We offer a distinctive shopping experience, a broad
merchandise assortment and value to our customers while maintaining an efficient
store level cost structure.

Our stores combine competitive pricing
with a highly promotional, in-store marketing effort that encourages customer
participation and creates a fun and exciting shopping experience. We believe
this highly promotional atmosphere results in various competitive advantages,
including increased multiple unit sales; the building of a loyal, repeat
customer base; the creation of word-of-mouth advertising; and enhanced sell
through of in-season goods. Our objective is to be the destination
store-of-choice for a wide range of consumers seeking moderately priced, current
season name brand and private label footwear. Our product assortment includes
dress and casual shoes, sandals, boots and a wide assortment of athletic shoes
for the entire family. We believe that by offering a wide selection of both
athletic and non-athletic footwear, we are able to reduce our exposure to shifts
in fashion preferences between those categories.

15

---

Our marketing effort targets moderate
income, value-conscious consumers seeking name brand footwear for all age
groups. We believe that by offering a wide selection of popular styles of name
brand merchandise at competitive prices, we generate broad customer appeal. Our
cost-efficient store operations and real estate strategy enable us to price
products competitively. Low labor costs are achieved by housing merchandise
directly on the selling floor in an open-stock format, enabling customers to
serve themselves, if they choose. This reduces the staffing required to assist
customers and reduces store level labor costs as a percentage of sales. We
locate stores predominantly in strip shopping centers in order to take advantage
of lower occupancy costs and maximize our exposure to value-oriented shoppers.

Critical Accounting Policies

It is necessary for us to include
certain judgments in our reported financial results. These judgments involve
estimates that are inherently uncertain and actual results could differ
materially from these estimates. The accounting policies that require the more
significant judgments are:

Merchandise
Inventories- Merchandise inventories are
stated at the lower of cost or market using the first-in, first-out (FIFO)
method. In determining market value, we estimate the future sales price of items
of merchandise contained in the inventory as of the balance sheet date. Factors
considered in this determination include, among others, current and recently
recorded sales prices, the length of time product has been held in inventory and
quantities of various product styles contained in inventory. The ultimate amount
realized from the sale of certain product could differ materially from our
estimates. We also estimate a shrinkage reserve for the period between the last
physical count and the balance sheet date. The estimate for the shrinkage
reserve can be affected by changes in merchandise mix and changes in actual
shrinkage trends.

Valuation of Long-Lived
Assets- We review long-lived assets whenever
events or circumstances indicate the carrying value of an asset may not be
recoverable and annually when no such event has occurred. We evaluate the
ongoing value of assets associated with retail stores that have been open longer
than one year. When events such as these occur, the assets subject to impairment
are adjusted to estimated fair value and, if applicable, an impairment loss is
recorded in selling, general and administrative expenses. Our assumptions and
estimates used in the evaluation of impairment, including current and future
economic trends for stores, are subject to a high degree of judgment and if
actual results or market conditions differ from those anticipated, additional
losses may be recorded.

Income Taxes- We calculate income taxes in accordance with SFAS No. 109,
"Accounting for Income Taxes" ("SFAS No. 109") and account for uncertain tax
positions in accordance with Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes  an interpretation of Financial Accounting Standards Board
("FASB") Statement No. 109" ("FIN 48"). Under SFAS No. 109, deferred tax assets
and liabilities are recognized based on the difference between the consolidated
financial statement carrying amounts of existing assets and liabilities and
their respective tax basis. Deferred tax assets and liabilities are measured
using the estimated tax rates in effect in the years when those temporary
differences are expected to reverse. Under FIN 48, we are required to make many
subjective assumptions and judgments regarding our income tax exposures.
Interpretations of and guidance surrounding income tax laws and regulations are
often complex, ambiguous and change over time. As such, changes in our
subjective assumptions and judgments can materially affect amounts recognized in
the consolidated financial statements.

Insurance Reserves- We use a combination of self-insurance and third-party
insurance for workers' compensation, employee medical and general liability
insurance. These plans have stop-loss provisions that protect us from individual
and aggregate losses over specified dollar values. When estimating our
self-insured liabilities, we consider a number of factors, including historical
claims experience, severity factors, statistical trends and, in certain
instances, valuation assistance provided by independent third-parties. We will
continue to evaluate our self-insured liabilities and the underlying assumptions
on a quarterly basis and make adjustments as needed. The ultimate cost of these
claims may be greater than or less than the established accruals. While we
believe that the recorded amounts are adequate, there can be no assurance that
changes to management's estimates will not occur due to limitations inherent in
the estimating process. In the event we determine an accrual should be increased
or reduced, we will record such adjustments in the period in which such
determination is made.

16

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Results of Operations Summary
Information

|                  | Number of Stores |           | Store Square Footage |        |   |       
|----------------- | ---------------- | --------- | -------------------- | ------ | - | ------
|                  | Beginning        |           |                      |        |   |       
|Quarter Ended     |                  | Of Period |                      | Opened |   | Closed
|May
      2, 2009 | 304              |           | 10                   |        | 1 |       
|August 1, 2009    | 313              |           | 2                    |        | 1 |       
|Year-to-date 2009 | 304              |           | 12                   |        | 2 |       
|                 
|May
      3, 2008 | 291              |           | 2                    |        | 0 |       
|August 2, 2008    | 293              |           | 12                   |        | 2 |       
|Year-to-date 2008 | 291              |           | 14                   |        | 2 |       

Comparable store sales for the periods
indicated include stores that have been open for 13 full months prior to the
beginning of the period, including those stores that have been relocated or
remodeled. Therefore, stores opened or closed during the periods indicated are
not included in comparable store sales.

The following table sets forth our
results of operations expressed as a percentage of net sales for the periods
indicated:

|                                        | Thirteen       |   | Thirteen       |       | Twenty-six     |  | Twenty-six    
|--------------------------------------- | -------------- | - | -------------- | ----- | -------------- |  | --------------
|                                        | Weeks Ended    |   | Weeks Ended    |       | Weeks Ended    |  | Weeks Ended   
|                                        | August 1, 2009 |   | August 2, 2008 |       | August 1, 2009 |  | August 2, 2008
|Net
      sales                         | 100.0          | % |                | 100.0 | %              |  | 100.0         
|Cost of sales (including
      buying,  |                |   |                |       |                |  |               
|distribution
      and occupancy costs) | 73.2           |   |                | 73.4  |                |  | 72.6          
|Gross
      profit                      | 26.8           |   |                | 26.6  |                |  | 27.4          
|Selling, general
    and                |                |   |                |       |                |  |               
|administrative
      expenses           | 25.6           |   |                | 25.7  |                |  | 24.7          
|Operating income                        | 1.2            |   |                | 0.9   |                |  | 2.7           
|Interest income                         | 0.0            |   |                | 0.0   |                |  | 0.0           
|Interest expense                        | 0.0            |   |                | 0.0   |                |  | 0.1           
|Income before income
      taxes        | 1.2            |   |                | 0.9   |                |  | 2.6           
|Income tax expense                      | 0.6            |   |                | 0.3   |                |  | 1.0           
|Net income                              | 0.6            | % |                | 0.6   | %              |  | 1.6           

Operational Summary

While consumer spending and the overall
economic environment remained challenging in the second quarter of fiscal 2009,
we were able to improve our year-over-year gross and operating margins for the
second quarter and, therefore, record earnings per share equal to last year. We
believe these results demonstrate the strength of our business model and our
ability to effectively manage the controllable aspects of our business,
particularly operating expenses, inventory, and our marketing and merchandising
strategies.

Our net sales declined in the second
quarter of fiscal 2009, compared to the prior year, primarily due to a decline
in customer traffic. Comparable store sales fell 6.4%. We believe the absence
of government stimulus checks, which were provided to consumers during the
second quarter last year, was one of the contributing factors for the decline in
traffic. In addition, sales-tax-free holidays in nine of our states shifted from
the second quarter, where they were reported in fiscal 2008, into the third
quarter this year. The shift in these sales-tax-free holidays, which have
historically created a significant incentive for the consumer to shop, accounted
for approximately 2% of our comparable store sales decline for the second
quarter of fiscal 2009.

17

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During the first quarter of fiscal
2009, we undertook an aggressive liquidation within our non-athletic categories
which positioned us with a fresher product assortment for the second quarter. As
a result, we were able to achieve an increase in the average net price and gross
margin of our footwear during the second quarter of fiscal 2009 as compared to
the prior year. Our per-store inventories at the end of the second quarter were
approximately flat as compared to the end of the second quarter of fiscal 2008.

We tightly controlled selling, general
and administrative expenses during the second quarter of fiscal 2009. This
resulted in year-over-year savings of $1.7 million, despite opening two new
stores during the quarter and operating 11 more stores than the same period last
year. Approximately 30% of this savings was due to shifting a portion of our
advertising into the third quarter to coincide with the shift in sales-tax-free
holidays.

We experienced a favorable start to the
third quarter of fiscal 2009, as the consumer responded well to both our
athletic and non-athletic product assortments to satisfy their back-to-school
needs. While considerable uncertainty remains regarding discretionary spending
by consumers after the back-to-school period, we remain optimistic about our
sales trend for the third quarter of fiscal 2009. Our management team has been
through many economic cycles and we will continue to conservatively manage the
controllable aspects of our business until we have better clarity with respect
to a sustained economic recovery.

Results of Operations for the Second
Quarter Ended August 1, 2009

Net Sales

Net sales decreased $5.7 million to
$152.8 million during the second quarter ended August 1, 2009, a 3.6% decrease
from the prior year's second quarter net sales of $158.5 million. The decrease
in net sales was due to a comparable store sales decline of 6.4% in addition to
the loss of sales from the 13 stores closed since the beginning of the second
quarter of last year. Approximately 2% of the comparable store sales decline was
attributable to the sales-tax-free holiday shift that occurred in nine of our
states. These sales-tax-free holidays shifted from the second quarter, where
they were reported in fiscal 2008, into the third quarter this year. This
combined decrease was partially offset by an $8.1 million increase in sales
generated by the new stores opened since the beginning of the second quarter of
fiscal 2008.

Gross Profit

Gross profit decreased $1.2 million to
$40.9 million in the second quarter of fiscal 2009 from gross profit of $42.1
million in the comparable prior year period. The gross margin in the second
quarter of fiscal 2009 increased 0.2% from the same period last year to 26.8%.
The merchandise margin increased 0.4%, largely as a result of efforts during the
first quarter to liquidate seasonal product and enter the second quarter of
fiscal 2009 with a fresher product assortment requiring less promotional
pricing. While occupancy costs increased as a result of operating an additional
11 stores at the end of the second quarter of fiscal 2009 compared to the prior
year, we were able to more than offset this increase through cost savings
initiatives within our buying and distribution functions. However, as a
percentage of sales, these costs increased 0.2% relative to the second quarter
of fiscal 2008 due to the decrease in net sales.

Selling, General and Administrative
Expenses

Selling, general and administrative
expenses decreased $1.7 million in the second quarter of fiscal 2009 to $39.0
million, or 25.6% of sales, from $40.7 million, or 25.7% of sales, in the
comparable prior year period. Even though we operated an additional 11 stores at
the end of the second quarter of fiscal 2009 compared to the prior year period,
we were able to achieve expense savings in a number of store-level categories
including supplies, depreciation and advertising. Advertising decreased
$468,000, primarily due to the shift in the sales-tax-free holidays.

Pre-opening costs included in selling,
general and administrative expenses were $153,000, or 0.1% of sales, for the
second quarter of fiscal 2009 as compared to $406,000, or 0.3% of sales, for the
second quarter of fiscal 2008. We opened two stores in the second quarter of
fiscal 2009 as compared to 12 stores in the second quarter of fiscal
2008.

18

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Pre-opening costs, such as advertising,
payroll and supplies, incurred prior to the opening of a new store are charged
to expense in the period they are incurred. The total amount of pre-opening
expense incurred will vary by store depending on the specific market and the
promotional activities involved.

Interest (Income) Expense, Net

We recorded net interest expense of
$41,000 in the second quarter of fiscal 2009 as compared to net interest income
of $3,000 in the second quarter of the prior year. As returns available on
short-term investments fell to record lows, we held our excess funds in
non-interest bearing deposit accounts to offset bank service fees.

Income Taxes

The effective income tax rate for the
second quarter of fiscal 2009 increased to 47.3% from 34.3% for the second
quarter of fiscal 2008. During the second quarter of both fiscal years, our rate
was primarily impacted by the true up of the prior year estimated annual income
tax rate.

Results of Operations for the Six
Months Ended August 1, 2009

Net Sales

Net sales decreased $490,000 to $320.1
million during the six months ended August 1, 2009, from net sales of $320.6
million in the comparable prior year period. The decrease in net sales was due
to a comparable store sales decline of 3.3% in addition to the loss of sales
from the 13 stores closed since the beginning of fiscal 2008. Approximately 1%
of the comparable store sales decline was attributable to the sales-tax-free
holiday shift that occurred in nine of our states. These sales-tax-free holidays
shifted from the second quarter, where they were reported in fiscal 2008, into
the third quarter this year. This decrease was offset by a $17.3 million
increase in sales generated by the new stores opened since the beginning of
fiscal 2008.

Gross Profit

Gross profit decreased $1.6 million to
$87.6 million in the first six months of fiscal 2009 from gross profit of $89.2
million in the comparable prior year period. The gross margin in the first half
of fiscal 2009 decreased 0.4% from the same period last year to 27.4%. The
merchandise margin decreased 0.4%, largely as a result of aggressive liquidation
of non-athletic footwear in the first quarter of fiscal 2009. Both as a
percentage of sales and in dollars, buying, distribution and occupancy costs
remained flat with prior year. While occupancy costs increased on a
year-over-year basis as a result of operating additional stores, we were able to
offset this increase through cost savings initiatives within our buying and
distribution functions.

Selling, General and Administrative
Expenses

Selling, general and administrative
expenses decreased $908,000 to $79.1 million, or 24.7% of sales, in the first
half of fiscal 2009 from $80.0 million, or 24.9% of sales, in the comparable
prior year period. Even though we operated additional stores during the first
half of fiscal 2009 compared to the prior year period, we were able to achieve
expense savings in a number of store-level categories, including depreciation
and advertising. These savings were partially offset by an increase of $583,000
in employee health care, incentives and benefits.

Pre-opening costs included in selling,
general and administrative expenses were $634,000, or 0.2% of sales, for the
first half of fiscal 2009 as compared to $440,000, or 0.1% of sales, for the
first half of fiscal 2008. We opened 12 stores in the first six months of fiscal
2009 as compared to 14 stores in the first six months of fiscal 2008.
Pre-opening costs, such as advertising, payroll and supplies, incurred prior to
the opening of a new store are charged to expense in the period they are
incurred. The total amount of pre-opening expense incurred will vary by store
depending on the specific market and the promotional activities involved.

19

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Interest (Income) Expense, Net

We recorded net interest expense of
$80,000 in the first half of fiscal 2009 as compared to net interest income of
$7,000 in the first half of the prior year. As returns available on short-term
investments fell to record lows, we held our excess funds for the majority of
the first half of fiscal 2009 in non-interest bearing deposit accounts to offset
bank service fees.

Income Taxes

The effective income tax rate for the
first six months of fiscal 2009 increased to 39.2% from 37.7% compared to the
same time period in 2008. The annual effective income tax rate is expected to be
approximately 39.0%.

Liquidity and Capital
Resources

Our primary sources of funds are cash
flows from operations and borrowings under our revolving credit facility. Our
net cash used in operations was $2.0 million in the first six months of fiscal
2009 as compared to net cash provided by operations of $13.8 million in the
first six months of 2008. The change in operating cash flow, when comparing the
two periods of each year, was primarily due to an increase in merchandise
inventories, partially offset by related accounts payable. During the second
quarter of fiscal 2008, given the adverse economic conditions, we lessened our
historical back-to-school build up of inventory levels and as a result reduced
our per-store inventories compared to the prior year period thus generating cash
flow. We continued to reduce our per-store inventories in the second half
of fiscal 2008. For the fiscal 2009 back-to-school season, we followed a more
normalized inventory build cycle and did not reduce per-store inventories
further on a year-over-year basis. Together with operating an additional 11
stores as compared to the second quarter of fiscal 2008, this increase in
per-store inventories resulted in a use of cash in fiscal 2009.

Working capital increased to $159.1
million at August 1, 2009 from $147.9 million at August 2, 2008. Approximately
$7.6 million of this increase was attributable to the merchandise inventories
required to operate the additional 11 stores open on August 1, 2009 as compared
to August 2, 2008. The current ratio at August 1, 2009 was 2.8 as compared to
2.7 at August 2, 2008. We had no interest bearing long-term debt as of the end
of either period.

During the first half of fiscal 2009,
we expended $5.5 million in cash for the purchase of property and equipment. Of
this expenditure, $4.3 million was used for new stores, store remodeling and
store relocation projects. An additional $685,000 was used to begin the
remediation of our distribution center's material handling system. The remaining
capital expenditures were used primarily for information technology and
miscellaneous equipment purchases.

We opened 12 new stores during the
first half of fiscal 2009 and we anticipate opening an additional four stores
during the second half of the year. Capital expenditures of approximately $4.4
million to $6.2 million will be made during the second half of fiscal 2009. Our
projected capital expenditures include a range of $300,000 to $2.3 million for
further remediation of our distribution center's material handling system. The
actual amount expended at the distribution center will be dictated by the level
of remediation effort that can reasonably be undertaken during the second half
of fiscal 2009. The remaining capital expenditures will be incurred for the
opening of new stores, store remodels and various other store improvements,
along with continued investments in technology and normal asset replacement
activities. We currently anticipate receiving an additional $1.1 million in
landlord incentives through the end of fiscal 2009. The actual amount of cash
required for capital expenditures for store operations depends in part on the
number of new stores opened, the amount of lease incentives, if any, received
from landlords and the number of stores remodeled. The opening of new stores
will be dependent upon, among other things, the availability of desirable
locations, the negotiation of acceptable lease terms and general economic and
business conditions affecting consumer spending in areas we target for
expansion.

Our current store prototype uses
between 8,000 and 12,000 square feet depending upon, among other factors, the
location of the store and the population base the store is expected to service.
For fiscal 2009, our new stores will average proximately 9,700 square feet.
Capital expenditures for a new store in fiscal 2009 are expected to average
approximately $341,000 and tenant improvement allowances are expected to average
$94,000. The average inventory investment in a new store is expected to range
from $350,000 to $500,000 depending on the size and sales expectation of the
store and the timing of the new store opening. Pre-opening expenses, such as
advertising, salaries and supplies, are expected to average approximately
$68,000 per store in fiscal 2009.

20

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We closed two stores during the first
half of both fiscal years. We expect to close six stores during the second half
of fiscal 2009 as compared to closing nine stores in the second half of fiscal
2008. We will continue to evaluate underperforming stores for possible closing
on a routine basis, which may result in the identification of additional store
closings for the current or future fiscal years. The timing and actual amount of
expense recorded in closing a store can vary significantly depending, in part,
on the period in which management commits to a closing plan, the remaining basis
in the fixed assets to be disposed of at closing and the amount of any lease
buyout.

As of August 1, 2009, our unsecured
credit agreement provided for up to $95.0 million in cash advances and
commercial and standby letters of credit. Borrowings under the revolving credit
line are based on eligible inventory. The credit agreement contains the
following covenants: (1) Total Shareholders' Equity, adjusted for the effect of
any share repurchases, will not fall below that of the prior fiscal year-end;
(2) the ratio of funded debt plus rent to EBITDA plus rent will not exceed 2.5
to 1.0; (3) total distributions for stock repurchases will not exceed $50.0
million; and (4) cash dividends will not reduce our Total Shareholders' Equity,
adjusted for the effect of any share repurchases, below that of the prior fiscal
year-end. We were in compliance with these covenants as of August 1, 2009.
Should a default condition be reported, the lenders may preclude additional
borrowings and call all loans and accrued interest at their discretion. As of
August 1, 2009, there were no cash advances outstanding and letters of credit
outstanding were $12.0 million. The amount available to us for additional
borrowings was $83.0 million as of August 1, 2009.

Our $50.0 million share repurchase
program will terminate on December 31, 2009, unless extended by our Board of
Directors. Share repurchases under this authorization may be made in the open
market or in privately negotiated transactions. The timing and actual number of
shares repurchased will depend on a variety of factors including price,
corporate and regulatory requirements and other market conditions. As of August
1, 2009, approximately 1.2 million shares had been repurchased at an aggregate
cost of $28.1 million. The amount that remained available under the existing
repurchase authorization at August 1, 2009 was $21.9 million. No shares have
been repurchased since the fourth quarter of fiscal 2007.

On or about April 22, 2008, an
arbitration claim was filed by SDI Industries, Inc. ("SDI") against us with the
American Arbitration Association Western Case Management Center in Los Angeles,
California, captionedSDI Industries, Inc.
(Claimant and Counter-Respondent) v. Shoe Carnival, Inc. (Respondent and
Counterclaimant),in which SDI sought payment
of $1.2 million of unpaid retainage, $700,000 for services not yet billed, plus
additional interest and legal fees. The retainage was withheld from progress
billings for work performed on our distribution center and was recorded in
accrued and other liabilities and fixed assets in our consolidated financial
statements. We filed a Counterclaim and Response in this matter, denying SDI's
claim, and seeking monetary damages of more than $3.0 million. We asserted that
SDI breached our contract with SDI ("Contract") due to its failure to deliver
our distribution center's material handling system pursuant to the
specifications of the Contract.

On May 30, 2009, the parties entered
into a settlement of the above matter. Under the terms of the settlement, SDI
agreed to forego collection of the $1.2 million in unpaid retainage and to pay
us $1.2 million towards the remediation of the distribution center's material
handling system. The $1.2 million will be paid in installments over seven years
and is evidenced by a promissory note secured by a standby letter of credit,
renewable annually, in an amount not less than $200,000 and by a security
interest in SDI's accounts receivable. In addition, both parties agreed to the
dismissal of all pending claims currently under arbitration. The installment due
on the promissory note within the next 12 months has been recorded in Accounts
receivable in our consolidated financial statements. The remaining balance of
the promissory note is recorded in Other as a non-current asset. SDI remitted
the first scheduled payment prior to the due date of July 1, 2009.

21

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Although the investment we made in the
distribution center will satisfy our distribution needs throughout fiscal 2009,
we have not achieved the productivity that we expect will be required based on
our plan for long-term store growth. We have contracted with another
distribution logistics company to provide recommendations as to system upgrades
to improve throughput and will implement certain of these recommendations in the
second half of fiscal 2009 and also possibly in fiscal 2010.

We anticipate that our existing cash
and cash flow from operations, supplemented by borrowings under our revolving
credit line, will be sufficient to fund our planned store expansion along with
other capital expenditures, any future repurchase of our common stock under our
current repurchase plan and working capital requirements for at least the next
12 months.

Seasonality

Our quarterly results of operations
have fluctuated and are expected to continue to fluctuate in the future
primarily as a result of seasonal variances and the timing of sales and costs
associated with opening new stores. Non-capital expenditures, such as
advertising and payroll, incurred prior to opening a new store are charged to
expense as incurred. Therefore, our results of operations may be adversely
affected in any quarter in which we incur pre-opening expenses related to the
opening of new stores.

We have three distinct peak selling
periods: Easter, back-to-school and Christmas.

New Accounting Pronouncements

Recent accounting pronouncements
applicable to our operations are contained in Note 3  "Recently Issued
Accounting Pronouncements" contained in the Notes to Condensed Consolidated
Financial Statements included in PART I, ITEM 1. FINANCIAL STATEMENTS of this
Quarterly Report on Form 10-Q.

ITEM 3. QUANTITATIVE AND QUALITATIVE
DISCLOSURES ABOUT MARKET RISK

We are exposed to market risk in that
the interest payable under our credit facility is based on variable interest
rates and therefore is affected by changes in market rates. We do not use
interest rate derivative instruments to manage exposure to changes in market
interest rates. We had no borrowings during the first half of fiscal
2009.

ITEM 4. CONTROLS AND PROCEDURES

Our Chief Executive Officer and Chief
Financial Officer have concluded, based on their evaluation as of August 1,
2009, that our disclosure controls and procedures are effective to ensure that
information required to be disclosed by us in the reports filed or submitted by
us under the Securities Exchange Act of 1934, as amended, is recorded,
processed, summarized and reported within the time periods specified in the
Securities and Exchange Commission's rules and forms, and include controls and
procedures designed to ensure that information required to be disclosed by us in
such reports is accumulated and communicated to our management, including the
Chief Executive Officer and Chief Financial Officer, as appropriate to allow
timely decisions regarding required disclosure.

Management is continuously seeking to
improve the efficiency and effectiveness of our operations and internal
controls. This results in refinements to processes throughout the company. As
part of our continued strategy to grow our store base and increase capacity, we
are in the process of redesigning certain elements of the material handling
system in our distribution center. The internal controls impacted by this
project are mainly automated and operational in nature. See our Notes to
Condensed Consolidated Financial Statements, Note 5  "Litigation Matters"
included in PART I, ITEM 1. FINANCIAL STATEMENTS of this Quarterly Report on
Form 10-Q for further details on this matter. There have been no other changes
in our internal control over financial reporting that occurred during the
quarter ended August 1, 2009 that have materially affected, or are reasonably
likely to materially affect, our internal control over financial reporting.

22

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SHOE CARNIVAL, INC. PART II -
OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS

The information set forth in Note 5 
"Litigation Matters" contained in the Notes to Condensed Consolidated Financial
Statement included in PART I, ITEM 1. FINANCIAL STATEMENTS of this Quarterly
Report on Form 10-Q is incorporated herein by reference.

ITEM 1A. RISK FACTORS

You should carefully consider the risks
and uncertainties we describe both in this Quarterly Report on Form 10-Q and in
the "Risk Factors" section of our Annual Report on Form 10-K for the fiscal year
ended January 31, 2009 before deciding to invest in, or retain, shares of our
common stock. These are not the only risks and uncertainties that we face.
Additional risks and uncertainties that we do not currently know about, we
currently believe are immaterial or we have not predicted may also harm our
business operations or adversely affect us. If any of these risks or
uncertainties actually occur, our business, financial condition, results of
operations or cash flows could be materially adversely affected. There have been
no material changes to the risk factors set forth in our Annual Report on Form
10-K for the fiscal year ended January 31, 2009.

ITEM 4. SUBMISSION OF MATTERS TO A
VOTE OF SECURITY HOLDERS

The annual meeting of our common
shareholders was held June 9, 2009.

Election of Directors

William E. Bindley and Kent A.
Kleeberger were elected at the annual meeting to serve as our Directors for
three-year terms. Mr. Bindley received 10,164,556 votes in favor of his election
and 2,226,489 votes were withheld. Mr. Kleeberger received 10,174,047 votes in
favor of his election and 2,216,998 votes were withheld.

In addition, the following Directors
continue in office until the annual meeting of shareholders in the year
indicated:



|Mark L. Lemond   | 2010
|---------------- | ----
|J. Wayne Weaver  | 2011
|Gerald W. Schoor | 2011

Other Matters Voted Upon at the
Meeting

The appointment of Deloitte &
Touche LLP as our independent registered public accounting firm for 2009 was
ratified. Votes of 12,371,091 were cast in favor, 18,919 votes were cast
against, 1,035 abstentions were recorded, and no broker non-votes were recorded
with respect to such ratification.

23

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ITEM 6. EXHIBITS

|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  | Incorporated by Reference To |  |       
|------- | --- | ----------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------------------- |  | ------
|Exhibit |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  | Filing
|No.     |     | Description |  | Form                                                                                                                                                                                                                                                                                                                    |  | Exhibit                      |  | Date  
|        | 3-A |             |  | Restated Articles of
      Incorporation of Registrant                                                                                                                                                                                                                                                                  |  | 10-K                         |  | 3-A   
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        | 3-B |             |  | By-laws
      of Registrant, as amended to date                                                                                                                                                                                                                                                                         |  | 8-K                          |  | 3-B   
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        | 4   |             |  | (i) Amended and Restated Credit
      Agreement and Promissory Notes dated April 16, 1999, between Registrant
      and Mercantile Bank National Association, First Union National Bank and
      Old National Bank                                                                                                     |  | 10-K                         |  | 4(I)  
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (ii) Amendment to Amended and
      Restated Credit Agreement and Promissory Notes dated March 24, 2000,
      between Registrant and Mercantile Bank National Association, First Union
      National Bank and Old National Bank                                                                                       |  | 10-K                         |  | 4(II) 
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (iii) Second Amendment to Amended
      and Restated Credit Agreement and Promissory Notes dated November 8, 2000,
      between Registrant and Firstar Bank N.A., First Union National Bank, Old
      National Bank and LaSalle Bank National Association                                                             |  | 10-Q                         |  | 4(III)
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (iv) Third Amendment to Amended
      and Restated Credit Agreement and Promissory Notes dated March 18, 2002,
      between Registrant and U.S. Bank National Association, First Union
      National Bank, Old National Bank and LaSalle Bank National
      Association                                              |  | 10-K                         |  | 4(IV) 
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (v) Fourth Amendment to Amended
      and Restated Credit Agreement and Promissory Notes dated March 12, 2003,
      between Registrant and U.S. Bank National Association, Wachovia Bank
      National Association, Old National Bank and LaSalle Bank National
      Association                                     |  | 10-K                         |  | 4(V)  
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (vi) Fifth Amendment to Amended
      and Restated Credit Agreement and Promissory Notes dated April 5, 2004,
      between Registrant and U.S. Bank National Association, Wachovia Bank
      National Association, Old National Bank and LaSalle Bank National
      Association                                      |  | 10-K                         |  | 4(VI) 
|        |     |             |  |                                                                                                                                                                                                                                                                                                                         |  |                              |  |       
|        |     |             |  | (vii) Assignment Agreement dated
      June 1, 2004 among LaSalle Bank National Association as Assignor, Fifth
      Third Bank (Southern Indiana) as Assignee, Registrant as Borrower and U.S.
      Bank National Association as Agent relating to the Amended and Restated
      Credit Agreement as further amended |  | 10-Q                         |  | 4(VII)

24

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EXHIBITS - Continued

|        |  |                                                                                                                                                                                                                                                                             |  | Incorporated by Reference To
|------- |  | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ----------------------------
|Exhibit |  |                                                                                                                                                                                                                                                                             |  |                             
|No.     |  | Description                                                                                                                                                                                                                                                                 |  | Form                        
|        |  | (viii) Sixth Amendment to Amended
      and Restated Credit Agreement and Notes dated April 5, 2005, between
      Registrant and U.S. Bank National Association, Wachovia Bank National
      Association, Fifth Third Bank (Southern Indiana) and Old National
      Bank |  | 8-K                         
|       
|        |  | (ix) Seventh Amendment to Amended
      and Restated Credit Agreement and Notes dated March 31, 2006, between
      Registrant and U.S. Bank National Association, Wachovia Bank, National
      Association and Fifth Third Bank                                           |  | 8-K                         
|       
|        |  | (x) Eighth Amendment to Amended
      and Restated Credit Agreement and Notes dated December 15, 2006, between
      Registrant and U.S. Bank National Association, Wachovia Bank, National
      Association and Fifth Third Bank                                          |  | 8-K                         
|       
|        |  | (xi) Ninth Amendment to Amended
      and Restated Credit Agreement and Notes dated June 10, 2008, between
      Registrant and U.S. Bank National Association, Wachovia Bank, National
      Association and Fifth Third Bank                                              |  | 10-Q                        
|       
|31.1    |  | Certification of Chief Executive
      Officer Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange
      Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
      of 2002                                                                |  |                             
|       
|31.2    |  | Certification of Chief Financial
      Officer Pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange
      Act of 1934, as Adopted Pursuant to Section 302 of the Sarbanes-Oxley Act
      of 2002                                                                |  |                             
|       
|32.1    |  | Certification of Chief Executive
      Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
      906 of the Sarbanes-Oxley Act of 2002                                                                                                               |  |                             
|       
|32.2    |  | Certification of Chief Financial
      Officer Pursuant to 18 U.S.C. Section 1350, as Adopted Pursuant to Section
      906 of the Sarbanes-Oxley Act of 2002                                                                                                               |  |                             

25

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SHOE CARNIVAL,
INC.SIGNATURE

Pursuant to the requirements of the
Securities Exchange Act of 1934, the registrant has duly caused this report to
be signed, on its behalf by the undersigned thereunto duly authorized.

|Date: September
      10, 2009 |                               | SHOE CARNIVAL,
      INC.
|------------------------------ | ----------------------------- | -------------------------
|                               |                               | (Registrant)             
|                              
|                              
|                               | By:/s/ W. Kerry
      Jackson
|                               | W. Kerry Jackson             
|                               | Executive Vice President and 
|                               | Chief Financial Officer      

26

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