Form 10-Q Quarterly Report
                           --------------------------

                UNITED STATES SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, 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               March 1, 1997
                               -------------------------------------------------
                                                   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                       1-5901
                      ----------------------------------------------------------

                              Fab Industries, Inc.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)


         Delaware                                            13-2581181
--------------------------------------------------------------------------------
(State or other jurisdiction of                          (I. R. S. Employer)
incorporation or organization)                           Identification No.)


   200 Madison Avenue, New York, N.Y.                            10016
--------------------------------------------------------------------------------
(Address of principal executive offices)                      (Zip Code)


                                 (212) 592-2700
--------------------------------------------------------------------------------
              (Registrant's telephone number, including area code)


                                       N/A
--------------------------------------------------------------------------------
              (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. Yes [X]  No [ ]

              CLASS                   Shares Outstanding at April 14, 1997
--------------------------------------------------------------------------------
   Common stock, $.20 par value                       5,707,055




<PAGE>

                      FAB INDUSTRIES INC. AND SUBSIDIARIES


                                TABLE OF CONTENTS


 PART I - FINANCIAL INFORMATION                                           PAGE

 Consolidated Statements of Income
      13 Weeks ended March 1, 1997 and March 2, 1996                           2

 Consolidated Balance Sheets (Asset Section)
      March 1, 1997 and November 30, 1996                                      3

 Consolidated Balance Sheets (Liability and Stockholders' Equity Section)
      March 1, 1997 and November 30, 1996                                      4

 Consolidated Statements of Stockholders' Equity
      13 Weeks ended March 1, 1997                                             5

 Consolidated Statements of Cash Flows
      13 Weeks ended March 1, 1997 and March 2, 1996                           6

  Notes to Consolidated Financial Statements                                   7

 PART II - OTHER INFORMATION

         Item 6. Exhibits and Reports on Form 8-K                             10


 Management's Discussion and Analysis of Financial Condition
 and Results of Operations                                                   11


 SIGNATURES                                                                  14


                                       (1)

<PAGE>

                      FAB INDUSTRIES, INC. AND SUBSIDIARIES

                        CONSOLIDATED STATEMENTS OF INCOME



<TABLE>
<CAPTION>
                                                             FOR THE 13 WKS ENDED
                                                    ------------------------------------
                                                    MARCH 1, 1997        MARCH 2, 1996
                                                    ---------------    -----------------
                                                       (Unaudited)         (Unaudited)
<S>                                                     <C>                 <C>
Net sales                                               $35,475,000         $35,588,000
Cost of goods sold                                       31,427,000          31,040,000
                                                      -------------         -----------
Gross profit                                              4,048,000           4,548,000


Selling, general and administrative expenses              3,038,000           3,249,000
                                                      -------------         -----------
Operating income                                          1,010,000           1,299,000
                                                      -------------         -----------
Other income (expense):
  Interest and dividend income                              946,000             857,000
  Interest expense                                          (16,000)            (18,000)
  Net gain on investment securities                         485,000             192,000

                                                      -------------         -----------
Total other income                                        1,415,000           1,031,000
                                                      -------------         -----------
Income before taxes                                       2,425,000           2,330,000

Taxes on Income                                             775,000             736,000
                                                      -------------         -----------

Net Income                                               $1,650,000          $1,594,000
                                                      =============         ===========


Earnings per share of common stock and                        $0.29               $0.27
 common stock equivalents

Weighted average number of shares of common
 stock and common stock equivalents                       5,752,438           5,900,657
</TABLE>

See notes to consolidated financial statements.


                                      (2)


<PAGE>


                      FAB INDUSTRIES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                   A S S E T S

<TABLE>
<CAPTION>
                                                                               AS OF
                                                               ------------------------------------
                                                               MARCH 1, 1997        NOVEMBER 30, 1996
                                                               ---------------    -----------------
                                                                (Unaudited)         
<S>                                                                 <C>                <C>       
Current assets:

  Cash and cash equivalents (Note 2)                                $6,560,000         $7,518,000
  Investment securities available-for-sale (Note 3)                 61,968,000         60,880,000
  Accounts receivable-net of allowance of
    $700,000 and $600,000 for doubtful
    accounts                                                        24,082,000         28,797,000
  Inventories (Note 4)                                              30,158,000         28,947,000
  Other current assets                                               1,980,000          1,944,000
                                                                  ------------       ------------
    Total current assets                                           124,748,000        128,086,000
                                                                  ------------       ------------




 Property, plant and equipment - at cost                           109,139,000        108,324,000
 Less:  Accumulated depreciation                                    79,399,000         78,121,000
                                                                  ------------       ------------
                                                                    29,740,000         30,203,000

 Other assets                                                        2,883,000          2,691,000
                                                                  ------------       ------------
                                                                  $157,371,000       $160,980,000
                                                                  ============       ============
</TABLE>

See notes to consolidated financial statements.


                                       (3)

<PAGE>


                      FAB INDUSTRIES, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                                 LIABILITIES AND

                              STOCKHOLDERS' EQUITY


<TABLE>
<CAPTION>
                                                                            AS OF
                                                            --------------------------------------
                                                             MARCH 1, 1997        NOVEMBER 30, 1996
                                                            ---------------       ----------------
                                                              (Unaudited)
<S>                                                                 <C>               <C>        
Current liabilities:

  Accounts payable                                                 $10,057,000        $12,076,000
  Corporate income and other taxes                                   2,011,000          1,667,000
  Accrued payroll and related expenses                               1,475,000          3,403,000
  Dividends payable                                                  1,006,000          1,007,000
  Other current liabilities                                            218,000            532,000
  Deferred income taxes                                                685,000            761,000
                                                                  ------------       ------------
    Total current liabilities                                       15,452,000         19,446,000
                                                                  ------------       ------------

Obligations under capital leases - net of
  current maturities                                                   604,000            620,000

Other noncurrent liabilities                                         2,441,000          2,364,000

Deferred income taxes                                                4,622,000          4,622,000
                                                                  ------------       ------------
    Total liabilities                                               23,119,000         27,092,000
                                                                  ------------       ------------

Stockholders' equity                                               134,252,000        133,888,000
                                                                  ------------       ------------
                                                                  $157,371,000       $160,980,000
                                                                  ============       ============
</TABLE>

See notes to consolidated financial statements.


                                       (4)


<PAGE>


                      FAB INDUSTRIES, INC. AND SUBSIDIARIES

                 CONSOLIDATED STATEMENTS OF STOCKHOLDERS' EQUITY

                      FOR THE 13 WEEKS ENDED MARCH 1, 1997
<TABLE>
<CAPTION>

                                                                                                                       
                                             Common Stock *                                                            
                                             -------------             Additional                    Loan to           
                                             Number of                 Paid-in      Retained         Employee Stock    
                                 Total        Shares        Amount     Capital      Earnings         Ownership Plan    
                                 -----     -------------  -----------   ---------   ------------     --------------  --
Balance at                                                                                          
<S>                          <C>             <C>         <C>          <C>          <C>               <C>               
November 30, 1996            $133,888,000    6,564,194   $1,313,000   $6,410,000   $157,223,000      ($7,907,000)      
                                                                                                    
Net income                      1,650,000                                             1,650,000                        
                                                                                                    
Cash dividends                 (1,006,000)                                           (1,006,000)    
                                                                                                    
Exercise of                                                                                         
stock options                       6,000          300                     6,000                                       
                                                                                                    
Purchase of                                                                                         
treasury stock                   (188,000)                                                                             
                                                                                                    
Compensation under                                                                                  
restricted stock plan              11,000                                                                              
                                                                                                    
Change in net unrealized                                                                            
holding gain (loss) on                                                                              
investment securities                                                                               
available-for-sale,                                                                                 
net of taxes                     (109,000)                                                                             
                            -------------    ---------   ----------   ----------   ------------     ------------      -
                                                                                                    
Balance at March 1, 1997     $134,252,000    6,564,494   $1,313,000   $6,416,000   $157,867,000      ($7,907,000)      
(Unaudited)                  ============    =========   ==========   ==========   ============     ============       
                                                                                                    
                                                                                                 

* Common  stock $0.20 par value -  15,000,000  shares  authorized.  
  Preferred stock $1.00 par value - 2,000,000 shares authorized, none issued.

See notes to consolidated financial statements.
<CAPTION>

                               Net                                            
                               Unrealized   Unearned       Treasury Stock 
                               Holding      Restricted     --------------------
                               Gain         Stock          Number of           
                              (Loss)        Compensation   Shares        Cost  
                              --------      ------------   --------   ---------
Balance at                                                                    
<S>                           <C>          <C>             <C>        <C>          
November 30, 1996             $607,000     ($58,000)       (806,439)  ($23,700,000)
                                                                              
Net income                                                                    
                                                                              
Cash dividends                                                                
                                                                              
Exercise of                                                                   
stock options                                                                 
                                                                              
Purchase of                                                                   
treasury stock                                               (7,000)      (188,000) 
                                                                              
Compensation under                                                            
restricted stock plan                        11,000                           
                                                                              
Change in net unrealized                                                      
holding gain (loss) on                                                        
investment securities                                                         
available-for-sale,                                                           
net of taxes                  (109,000)                                       
                              ---------    ---------        --------   ------------ 
Balance at March 1, 1997      $498,000     ($47,000)        (813,439)  ($23,888,000)
(Unaudited)                   ========     =========         ========   ===========
                                                                              
</TABLE>
* Common  stock $0.20 par value -  15,000,000  shares  authorized.  
  Preferred stock $1.00 par value - 2,000,000 shares authorized, none issued.

See notes to consolidated financial statements.


                                       (5)

<PAGE>

                      FAB INDUSTRIES, INC. AND SUBSIDIARIES
                      CONSOLIDATED STATEMENTS OF CASH FLOWS

                                                      FOR THE 13 WKS ENDED
                                            ------------------------------------
                                                 MARCH 1, 1997     MARCH 2, 1996
                                            ------------------    --------------
                                                    (Unaudited)      (Unaudited)
OPERATING ACTIVITIES:
Net Income                                           $1,650,000      $1,594,000
  Adjustments to reconcile net income
    to net cash provided by
    operating activities:
   Provision for doubtful accounts                      100,000         100,000
   Depreciation and amortization                      1,278,000       1,422,000
   Deferred income taxes                                (43,000)        (83,000)
   Net gain on investment securities                   (485,000)       (192,000)
   Compensation under restricted stock plan              11,000         132,000
   Decrease (increase) in:
     Accounts receivable                              4,615,000       9,175,000
     Inventories                                     (1,211,000)     (1,814,000)
     Other current assets                               (36,000)         35,000
     Other assets                                      (192,000)       (106,000)
   Decrease in:
     Accounts payable                                (2,019,000)     (2,374,000)
     Accruals and other liabilities                  (1,838,000)     (2,686,000)
                                                    -----------    ------------
       Net cash provided by
        operating activities                          1,830,000       5,203,000
                                                    -----------    ------------
CASH FLOWS FROM INVESTING ACTIVITIES:
  Purchases of property, plant and
    equipment                                          (815,000)       (599,000)

  Proceeds from sales of investment securities          560,000       5,556,000

  Acquisition of investment securities               (1,345,000)     (5,983,000)
                                                    -----------    ------------
       Net cash used in
         investing activities                        (1,600,000)     (1,026,000)
                                                    -----------    ------------
CASH FLOWS FROM FINANCING ACTIVITIES:
  Purchase of treasury stock                           (188,000)     (1,027,000)
  Dividends                                          (1,006,000)     (1,032,000)
  Exercise of stock options                               6,000          80,000
                                                    -----------    ------------
       Net cash used in financing
         activities                                  (1,188,000)     (1,979,000)
                                                    -----------    ------------
Increase (decrease) in cash and cash
  equivalents                                          (958,000)      2,198,000
Cash and cash equivalents,
  beginning of period                                 7,518,000       7,883,000
                                                    -----------    ------------
Cash and cash equivalents,
  end of period                                      $6,560,000     $10,081,000
                                                    ===========    ============

See notes to consolidated financial statements.


                                      (6)

<PAGE>

               NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

1.  Basis of presentation:

     The accompanying unaudited condensed consolidated financial statements have
been prepared in accordance with generally  accepted  accounting  principles for
interim  financial  information and the instructions to Form 10-Q and Rule 10-01
of Regulation S-X of the Securities and Exchange Commission.  Accordingly,  they
do not include  all of the  information  and  footnotes  required  by  generally
accepted accounting principles for complete financial statements. In the opinion
of management,  all adjustments  (consisting of only normal recurring  accruals)
considered  necessary  for a fair  presentation  have been  included.  Operating
results for the 13 weeks ended March 1, 1997 are not  necessarily  indicative of
the results that may be expected for the entire fiscal year ending  November 29,
1997.  The balance  sheet at November 30, 1996 has been derived from the audited
balance sheet at that date. For further  information,  refer to the consolidated
financial  statements  and footnotes  thereto  included in the Company's  Annual
Report on Form 10-K for the fiscal year ended November 30, 1996.


2.   Cash and cash equivalents consist of the following (in thousands):

                                                                November 30,
                                               March 1, 1997      1996
                                              -----------       -----------
                                               (Unaudited)

Cash                                             $1,518        $1,700

Tax-free short-term debt instruments              5,042         5,818
                                                 ------        ------
                                                 $6,560        $7,518
                                                 ======        ======


                                      (7)

<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS



3.   Investment Securities:

At March 1, 1997 and November 30, 1996, investment securities available-for-sale
consist of the following (in thousands):
<TABLE>
<CAPTION>


                                                                        Gross             Gross
                                                                      Unrealized         Unrealized
                                                                       Holding            Holding             Fair
 March 1, 1997 (Unaudited)                         Cost                 Gain               Loss               Value
------------------                                ---------           ----------          -------            ------

<S>                                                 <C>                  <C>                <C>                <C>   
Equities                                            $7,771               $385               ($163)             $7,993

U.S.  Government securities                             34                                                         34

Corporate bonds                                      5,644                175                  (3)              5,816

Tax exempt obligations                              47,690                462                 (27)             48,125
                                                  --------           --------            --------            --------
                                                   $61,139             $1,022               ($193)            $61,968
                                                  ========           ========            ========            ========
<CAPTION>

November 30, 1996                                                        Gross             Gross                      
------------------                                                     Unrealized         Unrealized                  
                                                                        Holding            Holding             Fair  
                                                    Cost                 Gain               Loss               Value  
                                                   ---------           ----------          -------            ------  
<S>                                                  <C>                  <C>                 <C>               <C>  

Equities                                            $7,251               $624               ($218)             $7,657  
                                                                                              
U.S.  Government securities                             37                                                        37
                         
Corporate bonds                                      5,689                155                 (37)              5,807

Tax exempt obligations                              46,891                513                 (25)             47,379
                                                  --------           --------            --------            --------
                                                   $59,868             $1,292               ($280)            $60,880
                                                  ========           ========            ========            ========
</TABLE>


                                      (8)

<PAGE>

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

4.   Inventories:

     The Company's  inventories are valued at the lower of cost or market.  Cost
is  determined  principally  by the last-in,  first-out  (LIFO)  method with the
remainder being determined by the first-in, first-out (FIFO) method. Because the
inventory valuation under the LIFO method is based upon an annual  determination
of  inventory  levels  and costs as of the fiscal  year-end,  the  interim  LIFO
calculations are based on management's  estimates of expected year-end inventory
levels and costs.
 

                                                                    November 30,
                                              March 1, 1997            1996
                                              ------------          ------------
                                                (Unaudited)

Raw materials                                   $11,349,000         $10,504,000
Work in process                                  10,272,000          10,087,000
Finished goods                                    8,537,000           8,356,000
                                                -----------         -----------
      Total                                     $30,158,000         $28,947,000
                                                ===========         ===========


Approximate percentage of
  inventories valued
  under LIFO valuation                                   63%                 65%
                                                ===========         ===========


Excess of FIFO valuation
  over LIFO valuation                            $6,861,000          $7,161,000
                                                ===========         ===========


                                       (9)

<PAGE>

                                          PART II.  OTHER INFORMATION



      Item 6.  Exhibits and Reports on Form 8-K

     (a)  Exhibits:  No exhibits are filed herewith  except for Exhibit 27 which
          is filed with EDGAR filing only.



     (b)  Reports on Form 8-K: The Registrant  did not file any Current  Reports
          on Form 8-K during the quarter ending March 1, 1997.


                                      (10)

<PAGE>

                      MANAGEMENT'S DISCUSSION AND ANALYSIS
                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

Results of Operations
First Quarter
Fiscal 1997 compared to Fiscal 1996

         Net sales for the first  quarter  of fiscal  1997 were  $35,475,000  as
compared  to  $35,588,000  in the  similar  1996  period,  a slight  decrease of
$113,000.  Customer  bookings and  shipments,  which were  depressed  during the
fourth quarter 1996, began to strengthen  during the current period.  This trend
has continued into the second quarter. Units shipped by our fabric divisions, as
well as product mix and selling prices,  remained  relatively  constant for both
periods.

         Gross profit as a percentage of sales decreased to 11.4% as compared to
12.8% for the first quarter of fiscal 1996. The major factor causing the decline
was lower  plant  utilization  rates,  offset  partially  by the  effects of the
Company's cost control  programs and a decrease of $300,000 in the LIFO reserves
due to lower average FIFO cost levels.

         Selling, general and administrative expenses declined to 8.6% from 9.1%
last year as expenditures  fell by $211,000.  Expenses  decreased as a result of
the continued  effectiveness of the Company's expense containment program, which
began in fiscal 1995.

         Interest  and  dividend  income  increased  by 10.4% in the  quarter to
$946,000 as against $857,000,  as a result of higher average available  balances
and higher  average  rates.  The  Company  had  realized  gains from the sale of
investment  securities  in the  quarter  of  $485,000  as  compared  to gains of
$192,000 in the first quarter of fiscal 1996.

         As a  result  of these  factors,  quarterly  net  income  increased  to
$1,650,000,  or 4.7% of sales, from $1,594,000, or 4.5% of sales last year first
quarter.


                                       (11)


<PAGE>



         Earnings per share, which are based upon the weighted average number of
shares outstanding  (5,752,438 vs. 5,900,657),  were $0.29 as compared to $0.27.
There  was no stock  option  related  dilution  in either  comparative  quarter.
Liquidity and Capital Resources

         The  Company's  principal  source  of funds  continues  to be cash flow
generated from operations.  Net cash provided by operating activities for the 13
weeks ended March 1, 1997  amounted to  $1,830,000  as compared to $5,203,000 in
the comparable 1996 period. Of this decrease,  $4,560,000 relates to comparative
declines in  accounts  receivable,  which were  offset by $603,000  related to a
comparative  increase  in  inventories,  and  $848,000  in  accruals  and  other
liabilities.

         Capital  expenditures for the quarter were $815,000 as against $599,000
in the comparable 1996 period. Subsequent to the end of the quarter, the Company
expended approximately $600,000 on fixed assets.

         In March 1997,  the Company  acquired the  copyrights,  trade name, and
certain assets of Wiener Laces,  Inc.,  manufacturer of raschel and leavers lace
goods for a total purchase price of approximately $1.0 million.

         The Company declared a quarterly dividend of $0.175 per share,  payable
April 25, 1997, to stockholders of record as of March 12, 1997.

         Stockholders' equity was $134,252,000, or $23.34 per share, as compared
to  $133,888,000,  or $23.25 per share at the previous fiscal year-end  November
30, 1996, and  $130,775,000,  or $22.43 per share at the end of the  comparative
1996 first quarter.


                                       (12)


<PAGE>



         Management  believes that the current financial position of the Company
is more than adequate to internally  fund any future  expenditures  to maintain,
modernize  and expand  its  manufacturing  facilities,  pay  dividends  and make
acquisitions of textile related businesses if criteria relating to indebtedness,
market expansion and existing management are met.


                                       (13)

<PAGE>
                                   SIGNATURES

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



Dated:   April 14, 1997                   FAB INDUSTRIES, INC.




                                         By: /s/ David A. Miller
                                            ---------------------------
                                               David A. Miller, Vice
                                        President - Finance and Treasurer
                                       (Principal Financial and Accounting
                                                    Officer)



                                      (14)