UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              WASHINGTON, DC 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 September 29, 2000

           ( )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                  333-38951

                               GFSI HOLDINGS, INC.
               (Exact name of registrant specified in its charter)


               Delaware                                74-2810744
    (State or other jurisdiction
   of incorporation or organization)       (I.R.S. Employer Identification No.)


                              9700 Commerce Parkway
                              Lenexa, Kansas 66219
                    (Address of principal executive offices)

        Registrant's telephone number, including area code (913) 888-0445

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.

    (1)      Yes      (X)              No        (   )
    (2)      Yes      (X)              No        (   )

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

Common stock, $0.01 par value per share - 1,967 shares issued and outstanding as
of November 1, 2000.


                                       1
<PAGE>

                       GFSI HOLDINGS, INC. AND SUBSIDIARY
                          Quarterly Report on Form 10-Q
                    For the Quarter Ended September 29, 2000
                                      INDEX


                                                                         Page
                                                                         ----

PART I - FINANCIAL INFORMATION

         ITEM 1 - CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)
                  Consolidated Balance Sheets                              3
                  Consolidated Statements of Income                        4
                  Consolidated Statements of Cash Flows                    5
                  Notes to Consolidated Financial Statements               6


         ITEM 2 - MANAGEMENT'S DISCUSSION AND ANALYSIS OF
                    FINANCIAL CONDITION AND RESULTS OF
                    OPERATIONS                                             7

PART II - OTHER INFORMATION                                               11

SIGNATURE PAGE                                                            12



                                       2

<PAGE>

GFSI HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(UNAUDITED)
(In thousands, except share data)

                                                       June 30,    September 29,
                                                         2000          2000
                                                         ----          ----
Assets
Current assets:
     Cash & cash equivalents                           $ 1,461         $ 230
     Accounts receivable, net                           29,801        33,930
     Inventories, net                                   40,140        38,304
     Prepaid expenses and other current assets           1,117         1,343
     Deferred income taxes                               1,122         1,122
                                                      --------      --------
Total current assets                                    73,641        74,929
Property, plant and equipment, net                      19,356        18,801
Other assets:
     Deferred financing costs, net                       6,434         6,139
     Other
                                                             5             5
                                                      --------      --------
Total assets                                          $ 99,436      $ 99,874
                                                      ========      ========

Liabilities and stockholders' equity
  (deficiency)
Current liabilities:
     Accounts payable                                  $ 5,317       $ 7,548
     Accrued interest expense                            4,000           995
     Accrued expenses                                    7,668         7,291
     Income taxes payable                                  308           857
     Current portion of long-term debt                   6,953         7,380
                                                      --------      --------
Total current liabilities                               24,246        24,071
Deferred income taxes                                    1,049         1,049
Revolving credit agreement                                  --            --
Other long-term obligations                                552           544
Long-term debt, less current portion                   228,474       228,203
Redeemable preferred stock                               4,907         5,013
Stockholders' equity (deficiency):
     Common stock, $.01 par value
       2,105 shares authorized,
       2,000 shares issued at June 30, 2000
       and September 29, 2000                               --            --
     Additional paid-in capital                            200           200
     Accumulated deficiency                           (159,990)     (159,204)
     Treasury stock, at cost (33 series A
       shares at June 30, 2000 and
       September 29, 2000)                                  (2)           (2)
                                                       --------      --------
Total stockholders' equity (deficiency)               (159,792)     (159,006)
                                                       --------      --------
Total liabilities and stockholders'
  equity (deficiency)                                 $ 99,436      $ 99,874
                                                       ========      ========

NOTE: The consolidated  balance sheet at June 30, 2000 has been derived from the
audited  financial  statements  at that date,  but does not  include  all of the
information and footnotes required by generally accepted  accounting  principles
for complete financial statements.

See notes to consolidated financial statements.

                                       3

<PAGE>

GFSI HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF INCOME
(UNAUDITED)
(In thousands)

                                                        Quarter Ended

                                                October 1,       September 29,
                                                   1999               2000
                                               ------------       -----------

Net sales                                       $ 54,839            $ 52,450

Cost of sales                                     33,612              32,327
                                                --------            --------

Gross profit                                      21,227              20,123


Operating expenses:

     Selling                                       6,424               6,025

     General and administrative                    6,188               6,570
                                                --------            --------
                                                  12,612              12,595
                                                --------            --------

Operating income                                   8,615               7,528


Other income (expense):

     Interest expense                             (6,157)             (6,115)

     Other, net                                       96                  50
                                                --------            --------
                                                  (6,061)             (6,065)
                                                --------            --------
Income before income taxes                         2,554               1,463


Provision for income taxes                         1,006                 571
                                                --------            --------

Net income                                         1,548                 892

Preferred stock dividends                           (107)               (106)
                                                --------            --------

Net income attributable to
  common shareholders                            $ 1,441               $ 786
                                                ========            ========

See notes to consolidated financial statements.

                                       4

<PAGE>

GFSI HOLDINGS, INC. AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF CASH FLOWS
(UNAUDITED)
(In thousands)


                                                          Quarter Ended

                                                  October 1,       September 29,
                                                     1999               2000
                                                 ------------       -----------


Cash flows from operating activities:
Net income                                            $ 1,548            $ 892
Adjustments to reconcile net income to
  net cash provided by (used in)
   operating activities:
     Depreciation                                         795              822
     Amortization of deferred financing costs             295              295
     Gain on sale or disposal of property,
       plant and equipment                                 (4)             (33)
     Amortization of discount on long-term debt         1,695            1,893
Changes in operating assets and liabilities:
     Accounts receivable, net                         (10,485)          (4,129)
     Inventories, net                                   1,499            1,835
     Prepaid expenses, other current
       assets and other assets                            319             (226)
     Income taxes payable                                 517              549
     Accounts payable, accrued expenses and other
       long-term obligations                           (2,990)          (1,159)
                                                       ------           ------
Net cash provided by (used in) operating activities    (6,811)             739
                                                       ------           ------
Cash flows from investing activities:
     Proceeds from sales of property,
       plant and equipment                                  4               64
     Purchases of property, plant and equipment          (980)            (298)
                                                       ------           ------
Net cash used in investing activities                    (976)            (234)
                                                       ------           ------
Cash flows from financing activities:
     Net changes to short-term borrowings
       and revolving credit agreement                      --               --
     Payments on long-term debt                        (1,637)          (1,736)
                                                       ------           ------
Net cash used in financing activities                  (1,637)          (1,736)
                                                       ------           ------
Net decrease  in cash and cash equivalents             (9,424)          (1,231)
Cash and cash equivalents at beginning of period       10,278            1,461
                                                       ------           ------
Cash and cash equivalents at end of period            $   854          $   230
                                                       ======           ======
Supplemental cash flow information:
     Interest paid                                    $ 7,128          $ 7,221
                                                       ======           ======
     Income taxes paid                                $    10          $    21
                                                       ======           ======
Supplemental schedule of non-cash
  financing activities:
     Accrual of preferred stock dividends             $   107           $  106
                                                       ======           ======
See notes to consolidated financial statements.


                                       5


<PAGE>



                       GFSI HOLDINGS, INC. AND SUBSIDIARY
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)
                               September 29, 2000

1.       Basis of Presentation
         ---------------------

     The  accompanying  unaudited  consolidated  financial  statements  of  GFSI
Holdings, Inc. ("Holdings" or the "Company") include the accounts of the Company
and the  accounts of its wholly  owned  subsidiary,  GFSI,  Inc.  ("GFSI").  All
intercompany  balances and  transactions  have been  eliminated.  The  unaudited
consolidated   financial  statements  have  been  prepared  in  accordance  with
generally accepted accounting  principles for interim financial  information and
with the  instructions to Form 10-Q and Article 10 of Regulation S-X promulgated
by the Securities and Exchange Commission.  Accordingly, they do not include all
of the  information  and  footnotes  required by generally  accepted  accounting
principles for annual financial statement reporting purposes.  In the opinion of
management, all adjustments (consisting of normal recurring accruals) considered
necessary for a fair  presentation  of the financial  position and operations of
the Company have been included.  Operating  results for the interim  periods are
not  necessarily  indicative  of the results that may be expected for the entire
fiscal year.  For further  information,  refer to the financial  statements  and
footnotes  thereto  for the year ended June 30, 2000  included in the  Company's
Annual Report on Form 10-K.

     The  preparation  of financial  statements  in  conformity  with  generally
accepted  accounting  principles  requires  management  to  make  estimates  and
assumptions  that  affect the  reported  amounts of assets and  liabilities  and
disclosure of  contingent  assets and  liabilities  at the date of the financial
statements  and the  reported  amounts  of  revenues  and  expenses  during  the
reporting period. Actual results could differ from those estimates.


2.       Commitments and Contingencies
         -----------------------------

     The Company,  in the normal course of business,  may be threatened  with or
named as a defendant in various  lawsuits.  It is not possible to determine  the
ultimate  disposition  of these matters,  however,  management is of the opinion
that there are no known  claims or known  contingent  claims  that are likely to
have  a  material  adverse  effect  on  the  results  of  operations,  financial
condition, or cash flows of the Company.


3.       New Accounting Standard
         -----------------------

     During the first quarter of fiscal 2001, the Company adopted the provisions
of Statement of Financial Accounting Standards ("SFAS") No. 133, "Accounting for
Derivative  Instruments and Hedging Activities".  This statement,  as amended by
SFAS No. 137 and SFAS No. 138,  establishes  accounting and reporting  standards
for derivative instruments and for hedging activities.  It requires an entity to
recognize all  derivatives  as either assets or  liabilities in the statement of
financial   position  and  measure  those   instruments   at  fair  value.   The
implementation of this statement did not have a material impact on the Company's
financial position, results of operations or cash flows.

     In December  1999,  the staff of the  Securities  and  Exchange  Commission
issues Staff Accounting  Bulletin No. 101 entitled  "Revenue  Recognition".  The
bulletin,  as  amended,  is to be adopted,  if needed,  no later than the fourth
fiscal  quarter  of fiscal  years  commencing  after  December  15,  1999,  with
retroactive  adjustment to the first fiscal quarter of that year. The effect, if
any, of complying  with the  accounting  described in this bulletin has not been
determined by management.


                                       6

<PAGE>

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

     The  discussions  set forth in this Form 10-Q should be read in conjunction
with the financial  information  included herein and the Company's Annual Report
on Form 10-K for the year  ended  June 30,  2000.  Management's  discussion  and
analysis of financial  condition and results of operations and other sections of
this report contain forward-looking statements relating to future results of the
Company.   Such   forward-looking   statements   are   identified   by   use  of
forward-looking words such as "anticipates",  "believes",  "plans", "estimates",
"expects",  and  "intends"  or words or  phrases of  similar  expression.  These
forward-looking  statements  are  subject  to  various  assumptions,  risks  and
uncertainties,  including but not limited to,  changes in political and economic
conditions,  demand for the  Company's  products,  acceptance  of new  products,
developments  affecting  the  Company's  products and to those  discussed in the
Company's  filings with the  Securities  and Exchange  Commission.  Accordingly,
actual  results  could  differ   materially  from  those   contemplated  by  the
forward-looking statements.

     The following sets forth the amount and percentage of net sales for each of
the periods indicated (dollars in thousands) Certain reclassifications have been
made  to  fiscal  year  2000   amounts  to  conform  to  the  fiscal  year  2001
presentation:

                                           Quarter Ended

                          October 1, 1999             September 29, 2000
                          ---------------             ------------------

Licensed Apparel     $ 23,128          42.3%        $ 21,375          40.8%

Resort                 14,384          26.2%          13,011          24.8%

Corporate              14,990          27.3%          16,382          31.2%

Event 1                   832           1.5%             150            .3%

Other                   1,505           2.7%           1,532           2.9%
                      -------                       --------
Total                 $54,839                       $ 52,450
                      =======                       ========


Results of Operations

     The following table sets forth certain historical financial  information of
the  Company,  expressed as a percentage  of net sales,  for the quarters  ended
October 1, 1999 and September 29, 2000.


                                           Quarter Ended

                                  October 1,          September 29,
                                    1999                   2000
                                    ----                   ----

Net sales                          100.0%                 100.0%

Gross profit                        38.7                   38.4

EBITDA                              17.2                   15.9

Operating income                    15.7                   14.4


                                       7
<PAGE>


     EBITDA  represents  operating income plus  depreciation  and  amortization.
While EBITDA should not be construed as a substitute  for operating  income or a
better  indicator of liquidity than cash flow from operating  activities,  which
are determined in accordance with generally accepted accounting  principles,  it
is included herein to provide additional information with respect to the ability
of the Company to meet its future debt service,  capital expenditure and working
capital requirements.  In addition,  the Company believes that certain investors
find  EBITDA to be a useful  tool for  measuring  the  ability of the Company to
service its debt.  EBITDA is not necessarily a measure of the Company's  ability
to fund its cash needs.  See the  Consolidated  Statements  of Cash Flows of the
Company herein for further information.


Comparison of Operating  Results for the Quarters  Ended  September 29, 2000 and
October 2, 1999

     Net Sales. Net sales for the first quarter of fiscal 2001, the three months
ended September 29, 2000,  decreased 4.4% to $52.4 million from $54.8 million in
the first quarter of fiscal 2000. The decrease in net sales  primarily  reflects
decreases in net sales at the Company's Resort and Licensed Apparel divisions of
9.6% and 7.6%,  respectively,  partially  offset by increases  at the  Company's
Corporate and Other divisions of 9.3% and 1.8%, respectively. The decline in the
Resort Division is attributable to increased  competition and the decline in the
Licensed  Apparel division is primarily due to the continued  unseasonably  warm
weather through much of the country which has decreased demand for the Company's
heavier  outerwear  products.  Net  sales at the  Company's  Event 1  subsidiary
declined  82.0% in the first quarter of fiscal 2001 to $150,000 from $832,000 in
the first quarter of fiscal 2000.

     Gross Profit.  Gross profit for the first quarter of fiscal 2001  decreased
5.2% to $20.1  million from $21.2  million in the first  quarter of fiscal 2000.
The  decrease in gross  profit is  primarily a result of the net sales  decrease
described  above.  For the first  quarter  of  fiscal  2001,  gross  profit as a
percentage  of net sales  decreased  slightly to 38.4%  compared to 38.7% in the
first quarter of fiscal 2000.

     Operating Expenses. Operating expenses for the first quarter of fiscal 2001
remained  consistent  with the first  quarter of fiscal  2000 at $12.6  million.
Operating expenses as a percentage of net sales increased to 24.0% from 23.0% in
the prior  year  first  quarter as a result of the  relatively  fixed  nature of
certain operating expenses.

     EBITDA. EBITDA for the first quarter of fiscal 2001 decreased 11.8% to $8.3
million from $9.4 million in the first quarter of fiscal 2000.  The decrease for
the period is primarily a result of the decrease in net sales and related  gross
profit described  above.  EBITDA as a percentage of net sales decreased to 15.9%
from 17.2% in the first quarter of fiscal 2000.

     Operating  Income.  Operating  income for the first  quarter of fiscal 2001
decreased 12.6% to $7.5 million from $8.6 million in the first quarter of fiscal
2000. The decrease is attributable to the changes in net sales and related gross
profit described  above.  Operating income as a percentage of net sales deceased
for the first quarter of fiscal 2001 to 14.4% from 15.7% in fiscal 2000.

     Other Income (Expense).  Other expense for the first quarter of fiscal 2001
remained consistent with the first quarter of fiscal 2000 at $6.1 million due to
the effect of debt payments under the Company's  $115 million  Credit  Agreement
offset by higher  interest  expense  related to  amortization of the discount on
Holdings' debt.  Interest rate fluctuations and their effect were immaterial for
the periods presented.  A reasonable likely change in the underlying rate, price
or index  would not have a  material  impact on the  financial  position  of the
Company.

     Income  Taxes.  The  effective  income  tax  rates for the  quarters  ended
September 29, 2000 and October 1, 1999 were 39.0% and 39.4%, respectively.

     Net Income.  Net income for the first  quarter of fiscal 2001 was  $892,000
million compared to $1.5 million in the first quarter of fiscal 2000.


                                       8

<PAGE>

Liquidity and Capital Resources

     Cash  provided by (used in) operating  activities  for the first quarter of
fiscal  2001 was  $739,000  compared to $(6.8)  million in the first  quarter of
fiscal 2000. The change in cash provided by operating activities between the two
periods  resulted from a decrease in net income for the period offset by changes
in working capital account  balances in the first quarter of fiscal year 2001 as
compared to the first quarter of fiscal 2000.

     Cash used by investing  activities  in the first quarter of fiscal 2001 was
$234,000  compared to $976,000  in the first  quarter of 2000.  The cash used in
both periods was related to acquisitions of property, plant and equipment.

     Cash used in financing  activities for the first quarter of fiscal 2001 was
$1.7 million  compared to $1.6 million in the first quarter of fiscal 2000.  The
cash used in  financing  activities  for both periods was  primarily  related to
scheduled debt repayments.

     The  Company  believes  that  cash  flow  from  operating   activities  and
borrowings  under the Credit  Agreement  will be adequate to meet the  Company's
short-term  and long-term  liquidity  requirements  prior to the maturity of its
Credit Agreement of 2002 and the Senior  Subordinated Notes in 2007, although no
assurance can be given in this regard. Under the Credit Agreement,  the Revolver
provides $50 million of revolving credit  availability  (of which  approximately
$10.9 million was utilized for  outstanding  commercial and stand-by  letters of
credit as of September 29, 2000).

     The Company is  dependent  upon the cash flows of GFSI to provide  funds to
pay certain  ordinary course  expenses  incurred on behalf of the Company and to
service the  indebtedness  represented  by the $50.0 million of 11.375% Series B
Senior Discount Notes due 2009 (the "Discount  Notes").  The Discount Notes will
accrete at a rate of 11.375%, compounded semi-annually to an aggregate principal
amount of $108.5 million at September 15, 2004.  Thereafter,  the Discount Notes
will accrue interest at the rate of 11.375% per annum, payable semi-annually, in
cash on March 15 and  September 15 of each year,  commencing  on March 15, 2005.
The  Company  will  be  dependent  on GFSI  to  provide  funds  to  service  the
indebtedness.  Additionally,  the remaining  cumulative Holdings Preferred Stock
will  accrue  dividends  totaling  approximately  $425,000  annually.   Holdings
Preferred  Stock may be redeemed at stated value  (approximately  $3.6  million)
plus accrued dividends with mandatory redemption in 2009.


Derivative and Market Risk Disclosure

     The   Company's   market  risk   exposure  is  primarily  due  to  possible
fluctuations in interest rates.  Derivative financial instruments may be used by
the  Company to manage its  exposure  on  variable  rate debt  obligations.  The
Company  uses a balanced mix of debt  maturities  along with both fixed rate and
variable rate debt to manage its exposure to interest  rate  changes.  The fixed
rate portion of the Company's long-term debt does not bear significant  interest
rate risk.  The variable rate debt would be affected by interest rate changes to
the extent the debt is not matched with an interest  rate swap or cap  agreement
or to the extent, in the case of the revolving credit  agreement,  that balances
are outstanding. An immediate 10 percent change in interest rates would not have
a material  effect on the Company's  results of operations  over the next fiscal
year,  although  there  can  be no  assurances  that  interest  rates  will  not
significantly change.

                                       9

<PAGE>

Seasonality and Inflation

     The   Company   experiences   seasonal   fluctuations   in  its  sales  and
profitability,  with  generally  higher  sales and gross profit in the first and
second quarters of its fiscal year. The  seasonality of sales and  profitability
is primarily due to higher volume at the College  Bookstore  division during the
first two  fiscal  quarters.  This  pattern  of sales  affects  working  capital
requirements and liquidity,  as the Company generally must finance higher levels
of inventory  during these periods prior to fully  receiving  payment from these
customers. Sales and profitability at the Company's Resort, Corporate and Sports
Specialty divisions typically show no significant  seasonal  variations.  As the
Company  continues to expand into other  markets in its Resorts,  Corporate  and
Sports Specialty divisions, seasonal fluctuations in sales and profitability are
expected to decline.

     The  impact  of  inflation  on  the  Company's   operations  has  not  been
significant  to date.  However,  there can be no  assurance  that a high rate of
inflation  in the  future  would not have an  adverse  effect  on the  Company's
operating results.


                                       10

<PAGE>


PART II - OTHER INFORMATION


Item 1.   Legal Proceedings
          -----------------

There has been no change to matters discussed in  Business-Legal  Proceedings in
Holdings'  Form 10-K as filed with the  Securities  and Exchange  Commission  on
September 29, 2000.


Item 2.   Changes in Securities
          ---------------------

None.


Item 3.   Defaults Upon Senior Securities
          -------------------------------

None.


Item 4.   Submission of Matters to a Vote of Security Holders
          ---------------------------------------------------

None.


Item 5.   Other Information
          -----------------

None.


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

     (a)  Exhibits.  The following exhibits are included with this report:

          Exhibit 27 - Financial Data Schedule (SEC Use Only)

     (b)  Reports on Form 8-K

          No reports on Form 8-K were filed by the  Registrant  during the
          reporting period.


                                       11
<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.


GFSI HOLDINGS, INC.
November 13 , 2000
                                        /s/ ROBERT G. SHAW
                                        ---------------------------------------
                                        Robert G. Shaw, Sr. Vice President
                                        of Finance and Principal
                                        Accounting Officer



                                       12