<PAGE>

                                 UNITED STATES
                      SECURITIES AND EXCHANGE COMMISSION

                            Washington, D. C. 20549

                                   FORM 10-K

               ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF
                      THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended December 31, 2001        Commission file number 0-2612

                            LUFKIN INDUSTRIES, INC.
--------------------------------------------------------------------------------
            (Exact name of registrant as specified in its charter)

             Texas                                      75-0404410
--------------------------------                ----------------------------
(State or other jurisdiction of                       (I.R.S. Employer
incorporation or organization)                      Identification No.)

    601 South Raguet, Lufkin, Texas                        75904
----------------------------------------        ------------------------------
(Address of principal executive offices)                 (Zip Code)

Registrant's telephone number, including area code     936/634-2211
                                                   -------------------

Securities registered pursuant to Section 12(b) of the Act:  None
Securities registered pursuant to Section 12(g) of the Act:


                     Common Stock, Par Value $1 Per Share
                     ------------------------------------
                               (Title of Class)


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
                                        -----    -----

Indicate by "X" if disclosure of delinquent filers pursuant to Item 405 of
Regulation S-K is not contained herein and will not be contained, to the best of
the registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-K or any amendment to this
Form 10-K. [X]

The aggregate market value of the Company's voting stock held by non-affiliates
as of March 20, 2002 was $139,850,788.

6,392,633 shares of the Company's Common Stock were outstanding on March 20,
2002.


                      DOCUMENTS INCORPORATED BY REFERENCE

Portions of the sections entitled "Financial Review", "Letter to Shareholders",
"Management's Discussion and Analysis", "Lufkin at a Glance"  and the
consolidated financial statements of the Company's Annual Report to Shareholders
for the year ended December 31, 2001, are incorporated by reference in Parts I,
II and IV, hereof and are included as Exhibit 13.

The sections entitled "Quorum and Voting Securities", "Nominees for Director",
"Information About Current and Continuing Directors", "Executive Compensation"
and "Security Ownership of Certain Beneficial Owners and Management" of the
Company's definitive Proxy Statement for its annual meeting of shareholders on
May 1, 2002, are incorporated by reference in Part III hereof.
<PAGE>

                                   Part I



Item 1.  Business

     The Company was incorporated under the laws of the State of Texas on March
4, 1902, and since that date has maintained its principal office and
manufacturing facilities in Lufkin, Texas. The Company designs, manufactures and
sells various types of oil field pumping units and related products, power
transmission products and highway trailers. Lufkin manufactures four basic types
of pumping units: an air-balanced unit; a beam-balanced unit; a crank-balanced
unit; and a Mark II Unitorque unit. The basic differences between the four types
relate to the counterbalancing system. The depth of a well and the desired fluid
production determine the type of counterbalancing configuration that is
required. There are numerous sizes and combinations of Lufkin oil field pumping
units within the four basic types. The Company also transports and services
pumping units through a service center network. Pumping unit automation products
lower production costs and optimize well efficiency through software and
instrumentation. The Company's foundry castings are primarily customer designed
components manufactured by Lufkin for use in customer products. The Company's
power transmission products (speed increasers and reducers) are designed,
manufactured and sold primarily for use in industrial applications such as
petrochemical, refining, rubber, plastics and steel and for use in marine
propulsion applications. The Company produces numerous sizes and combinations of
gears. In addition, the Company repairs and services not only its own products
but also those of other manufacturers through a dedicated facility. Lufkin also
produces various sizes and styles of highway trailers, including vans, platforms
and dumps. Trailer service centers repair both Lufkin trailers and those of
competitors.

     The Company manufactures most of the component parts used in its oil field,
foundry and power transmission products and purchases the raw materials and
outside manufactured parts from a variety of suppliers on an order basis.  The
Trailer Division generally assembles various component parts manufactured by
others. Inventories consist primarily of raw materials and component parts which
are generally assembled into finished products to fill specific customer orders.
These finished products are sold primarily by the Company's own employees.

     Oil field pumping units are the Company's primary products sold for export.
These sales, other than to Canada, are made principally through foreign sales
representatives, licensees and distributors. During 2001, foreign sales
accounted for approximately 30 percent of the Company's total sales.

     The Company's domestic and international markets are highly competitive
with price, quality and speed of delivery being important factors.  While the
Company believes that it is one of the larger manufacturers of sucker rod
pumping units in the United States, manufacturers of other types of units
(submersibles and hydraulics) have a significant share of the total pumping unit
market.  The Company does not believe it has a large market share in the power
transmission or trailer markets.

     The Company employed approximately 1,900 people at December 31, 2001,
including approximately 1,300 that were paid on an hourly basis.  The Company
has an open shop contract, which runs until October 7, 2002, with three AFL-CIO
labor unions.  The Company considers its employee relations to be satisfactory.

     Additional information required by Item 1 is included in the sections
entitled "Management's Discussion and Analysis", "Letter to the Shareholders",
and "Lufkin at a Glance" of the Company's Annual Report to Shareholders,
portions of which sections are incorporated herein by reference and included as
part of Exhibit 13.

Item 2.  Properties

     The Company's major manufacturing facilities are located in and near
Lufkin, are owned in fee and include approximately 150 acres, a foundry, machine
shop, structural shops, assembly shops and warehouses.  The Company also has a
plant in Nisku, Canada that produces structural parts for pumping units.  These
parts are then assembled with parts shipped from Lufkin and are delivered to the
Company's Canadian customers.  The Company also has a plant in Fougerolles,
France that manufactures, assembles and sells industrial gears and power
transmission products throughout Europe.


Item 3.  Legal Proceedings

     The information required by Item 3 is included in the section entitled
"Management's Discussion and Analysis" of the Company's Annual Report to
Shareholders under the heading "Legal Proceedings," which section is included as
part of Exhibit 13 and is incorporated herein by reference.

<PAGE>

Item 4.  Submission of Matters to a Vote of Shareholders

     None


Item 4a.  Executive Officers of the Registrant

     The following information is submitted with respect to the executive
officers of the Company as of March 1, 2002:

                                                              Executive
                                                               Officer
     Name            Position with Company             Age      Since
    ------           ---------------------            -----   ---------
D. V. Smith          Chairman, President &
                     Chief Executive Officer            59      1993
J. F. Glick          Vice President                     49      1994
S. H. Semlinger      Vice President                     48      1992
L. M. Hoes           Vice President                     55      1996
P. G. Perez          Vice President/Secretary           56      1996
R. D. Leslie         Vice President/Treasurer/CFO       56      1999

     There is no significant family relationship either by blood or by marriage
among the officers of the Company.

     All of the executive officers of the Company, with the exception of Mr.
Leslie, have been employed by the Company for more than five years in the same
or similar positions. Mr. Leslie has been employed by the Company since October
1992.  Prior to becoming the Company's Treasurer, Mr. Leslie served as the
Company's Controller and Chief Accounting Officer.  Prior to joining the
Company, Mr. Leslie was employed by Sanifill, Inc. in Houston, Texas, as Vice
President of Finance and Chief Accounting Officer.  The executive officers of
the Company serve at the request of the Board of Directors of the Company.  The
term of office for all executive officers expires at the next annual meeting of
the Board of Directors of the Company.


                                    Part II


Item 5.  Market for the Registrant's Common Stock
         and Related Shareholder Matters

     The information required by Item 5 is included in the section entitled
"Financial Review" of the Company's Annual Report to Shareholders, which section
is included as part of Exhibit 13 and is incorporated herein by reference.

Item 6.  Selected Financial Data

<TABLE>
<CAPTION>

                                   FIVE YEAR SUMMARY OF SELECTED
                                    CONSOLIDATED FINANCIAL DATA

(In millions, except per share data)          2001     2000     1999     1998      1997
------------------------------------         ------   ------   ------   ------    ------
<S>                                          <C>      <C>      <C>       <C>      <C>
Sales (1)                                    $278.9   $254.6   $246.0    $287.5   $291.8
Earnings (loss) from operations                19.5      7.0     (1.3)     13.6     14.8
Earnings (loss) per share
 Basic                                         3.12     1.11    (0.20)     2.11     2.26
 Diluted                                       3.03     1.11    (0.20)     2.08     2.22
Total assets                                  246.1    233.6    221.4     242.8    209.8
Long-term notes payable, net of current         0.3      7.0      9.1      11.5      6.7
Cash dividends per share                        .72      .72      .72       .72      .68
</TABLE>

(1) Sales for prior periods have been restated to reflect the reclassification
of freight charges billed to customers as revenues and the related expenses as
cost of sales in accordance with the guidance specified by EITF Issue 00-10.
The Company previously accounted for freight charged to customers as a reduction
of cost of sales.  Net earnings for these periods were not affected by this
reclassification.


Item 7.  Management's Discussion and Analysis
         of Financial Condition and Results of Operations

     The information required by Item 7 is included in the section entitled
"Management's Discussion and Analysis" of the Company's Annual Report to
Shareholders, which section is included as part of Exhibit 13 and is
incorporated herein by reference.

<PAGE>

Item 7a. Quantitative and Qualitative Disclosures about
         Market Risk

     The information required by Item 7a is included in the section entitled
"Management's Discussion and Analysis" of the Company's Annual Report to
Shareholders under the heading "Quantitative and Qualitative Disclosures about
Market Risk," which section is included as part of Exhibit 13 and is
incorporated herein by reference.

Item 8.  Financial Statements and Supplementary Data

     The information required by Item 8 is included in the consolidated
financial statements and related notes and the "Report of Independent Public
Accountants" of the Company's Annual Report to Shareholders, which consolidated
financial statements and related notes and report of independent public
accountants are included as part of Exhibit 13 and are incorporated herein by
reference.

Item 9. Changes in and Disagreements with Accountants on Accounting and
        Financial Disclosure

     None

                                   Part III


Item 10.  Directors and Executive Officers of
          the Registrant

     The information required by Item 10 relating to the directors of the
Company is included in the sections entitled "Nominees for Director" on page 2
and "Information About Current and Continuing Directors" on pages 4 and 5 of the
definitive Proxy Statement for the annual meeting of Company shareholders on May
1, 2002 ("Proxy Statement"), which sections are incorporated herein by
reference.  The information relating to the executive officers of the Company is
provided in Item 4a of Part I of this Annual Report.

Item 11.  Executive Compensation

     The information required by Item 11 is included in the section entitled
"Executive Compensation" on pages 5 through 10 of the Proxy Statement, which
section is incorporated herein by reference.


Item 12.  Security Ownership of Certain Beneficial Owners and Management

     The information required by Item 12 is included in the sections entitled
"Quorum and Voting Securities" on page 1 and "Security Ownership of Certain
Beneficial Owners and Management" on page 12 of the Company's Proxy Statement,
which sections are incorporated herein by reference.

Item 13.  Certain Relationships and Related Transactions

     None


                                    Part IV


Item 14.  Exhibits, Financial Statement Schedules,
          and Reports on Form 8-K

     (a)  Documents filed as part of the report

          1.  Consolidated Financial Statements (incorporated by
              reference to the Annual Report to Shareholders)

              Report of Independent Public Accountants
              Consolidated Balance Sheets
              Consolidated Statements of Earnings
              Consolidated Statements of Shareholders'
               Equity
              Consolidated Statements of Cash Flows
              Notes to Consolidated Financial Statements

         2.   Financial Statement Schedules
<PAGE>

             Schedule II Valuation and Qualifying Accounts

         3.  Exhibits

             (3.1) Articles of Incorporation, as amended, included as Exhibit
                   3 to Form 10-K of the registrant for the year ended December
                   31, 1990, which exhibit is incorporated herein by reference.

             (3.2) Articles of Amendment to Fourth Restated Articles of
                   Incorporation, included as Exhibit 3.1 to Form 8-K of the
                   registrant filed December 10, 1999, which exhibit is
                   incorporated herein by reference.

             (3.3) Restated Bylaws, included as Exhibit 3.2 to Form
                   8-K of the registrant filed December 10, 1999, which exhibit
                   is incorporated herein by reference.

            (10.1) Shareholder Rights Agreement, dated as of May 4,
                   1987, was included as Exhibit 1 to Form 8-A of the
                   registrant dated May 13, 1987, which agreement is
                   incorporated herein by reference.

           (10.2)* Company's 1990 Stock Option Plan was included as Exhibit 4.3
                   to the Company's registration statement on Form S-8 dated
                   August 23, 1995(File No. 33-62021), which plan is
                   incorporated herein by reference.

           (10.3)* Company's 1996 Nonemployee Director Stock Option Plan was
                   included as Exhibit 4.3 to the Company's registration
                   statement on Form S-8 dated June 28, 1996 (File No. 333-
                   07129), which plan is incorporated herein by reference.

             (13)  The Annual Report to Shareholders for the year ended December
                   31, 2001, is included as an exhibit to this report for the
                   information of the Securities and Exchange Commission.

             (21)  Schedule listing subsidiaries of the registrant

             (23)  Consent of Independent Public Accountants

             (99)  Confirmation of Receipt of Assurances from Arthur Andersen
                   LLP

         *Compensatory plan.

    (b) Reports on Form 8-K filed during the fourth quarter of 2001:

         None
<PAGE>

                                  SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, Lufkin Industries, Inc. has duly caused this report to be
signed on its behalf by the undersigned, thereunto duly authorized,
on March 25, 2002.

LUFKIN INDUSTRIES, INC.

BY   /s/ R. D. Leslie
  ------------------------------------------------
  R. D. Leslie, Vice President/Treasurer/Chief Financial Officer
  Principal Financial and Accounting Officer

     Pursuant to the requirements of the Securities Exchange Act of 1934, this
report has been signed on March 25, 2002, below by the following persons on
behalf of Lufkin Industries, Inc. and in the capacities indicated.


    /s/ D. V. Smith
By________________________________________________
  D. V. Smith, President and Chief Executive
  Officer


    /s/ S. W. Henderson, III
By________________________________________________
  S. W. Henderson, III, Director


    /s/ L. R. Jalenak, Jr.
By________________________________________________
  L. R. Jalenak, Jr., Director


    /s/ H. H. King
By________________________________________________
  H. H. King, Director


    /s/ M. E. Kurth, Jr.
By________________________________________________
  M. E. Kurth, Jr., Director


    /s/ J. H. Lollar
By________________________________________________
  J. H. Lollar, Director


    /s/ B. H. O'Neal
By________________________________________________
  B. H. O'Neal, Director


    /s/ H. J. Trout, Jr.
By________________________________________________
  H. J. Trout, Jr., Director


    /s/ W. W. Trout, Jr.
By________________________________________________
  W. W. Trout, Jr., Director


    /s/ T. E. Wiener
By________________________________________________
  T. E. Wiener, Director
<PAGE>

To the Shareholders of Lufkin Industries, Inc.


We have audited in accordance with auditing standards generally accepted in the
United States, the financial statements of Lufkin Industries, Inc. and
subsidiaries included in this registration statement and have issue our report
thereon dated February 8, 2002.  Our audit was made for the purpose of forming
an opinion on the basic financial statements taken as a whole.  Schedule II,
listed in the index above, is the responsibility of the company's management and
is presented for purposes of complying with the Securities and Exchange
Commission's rules and is not part of the basic financial statements.  This
schedule has been subjected to the auditing procedures applied in the audit of
the basic financial statements and, in our opinion, fairly states in all
material respects the financial data required to be set forth therein in
relation to the basic financial statements taken as a whole.



Houston, Texas
February 8, 2002
<PAGE>

                            LUFKIN INDUSTRIES, INC.
                 SCHEDULE II - VALUATION & QUALIFYING ACCOUNTS
                           (in thousands of dollars)

<TABLE>
<CAPTION>
                                                              Additions
                                                        ---------------------
                                            Balance at             Charged to               Balance at
                                            Beginning     Charged    Other                     End
          Description                        Of Year    to Expense  Accounts   Deductions    Of Year
          -----------                       ---------   ----------  --------   ----------   ----------
<S>                                         <C>         <C>         <C>        <C>          <C>
Allowance for Doubtful Accounts:
   Year Ended December 31, 2001                $  605      $213       $   -      $    -        $  818
   Year Ended December 31, 2000                $  605      $  -       $   -      $    -        $  605
   Year Ended December 31, 1999                $  625      $  -       $  25      $   45        $  605

Inventory Reserves:
   Year Ended December 31, 2001                $1,219      $  -       $  82      $  859        $  442
   Year Ended December 31, 2000                $1,996      $649       $   -      $1,426        $1,219
   Year Ended December 31, 1999                $5,607      $230       $   -      $3,841        $1,996

Property, Plant and Equipment Reserve:
   Year Ended December 31, 2001                $  549      $  -       $   -      $    -        $  549
   Year Ended December 31, 2000                $  549      $  -       $   -      $    -        $  549
   Year Ended December 31, 1999                $  549      $  -       $   -      $    -        $  549

Health Trust Receivable Reserve:
   Year Ended December 31, 2001                $    -      $460       $   -      $    -        $  460
   Year Ended December 31, 2000                $    -      $  -       $   -      $    -        $    -
   Year Ended December 31, 1999                $    -      $  -       $   -      $    -        $    -
</TABLE>
<PAGE>

                               INDEX TO EXHIBITS

Exhibit
Number     Description
-------    -----------

 (3.1)     Articles of Incorporation, as amended, included as Exhibit 3 to Form
           10-K of the registrant for the year ended December 31, 1990, which
           exhibit is incorporated herein by reference.

 (3.2)     Articles of Amendment to Fourth Restated Articles of Incorporation,
           included as Exhibit 3.1 to Form 8-K of the registrant filed December
           10, 1999, which exhibit is incorporated herein by reference.

 (3.3)     Restated Bylaws, included as Exhibit 3.2 to Form 8-K of the
           registrant filed December 10, 1999, which exhibit is incorporated
           herein by reference.

(10.1)     Shareholder Rights Agreement, dated as of May 4, 1987, was included
           as Exhibit 1 to Form 8-A of the registrant dated May 13, 1987, which
           agreement is incorporated herein by reference.

(10.2)*    Company's 1990 Stock Option Plan was included as Exhibit 4.3 to the
           Company's registration statement on Form S-8 dated August 23,
           1995(File No. 33-62021), which plan is incorporated herein by
           reference.

(10.3)*    Company's 1996 Nonemployee Director Stock Option Plan was included as
           Exhibit 4.3 to the Company's registration statement on Form S-8 dated
           June 28, 1996 (File No. 333-07129), which plan is incorporated herein
           by reference.

(13)       The Annual Report to Shareholders for the year ended December 31,
           2001, is included as an exhibit to this report for the information of
           the Securities and Exchange Commission.

(21)       Schedule listing subsidiaries of the registrant

(23)       Consent of Independent Public Accountants

(99)       Confirmation of Receipt of Assurances from Arthur Andersen LLP