<PAGE>   1

                       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 [FEE REQUIRED].

For fiscal year ended,  SEPTEMBER 30, 1997        Commission file number 1-9965
                        ------------------                               ------

                           KEITHLEY INSTRUMENTS, INC.
--------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)

               OHIO                                      34-0794417
----------------------------------------    ------------------------------------
(State of incorporation or organization)    (I.R.S. Employer Identification No.)

    28775 AURORA ROAD, SOLON, OHIO                         44139
------------------------------------------     --------------------------------
 (Address of principal executive offices)                (Zip Code)

Registrant's telephone number, including area code   (440) 248-0400
                                                    -----------------

Securities registered pursuant to Section 12(b) of the Act:

COMMON SHARES, WITHOUT PAR VALUE                 NEW YORK STOCK EXCHANGE
-----------------------------------     ---------------------------------------
     (Title of each class)              (Name of exchange on which registered)



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, and (2) has been subject to such filing requirements
for the past 90 days. Yes X  No
                         ---   ---

Indicate by check mark 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]

As of December 16, 1997 there were outstanding 4,885,655 Common Shares, without
par value, and 2,785,378 Class B Common Shares, without par value. At that date,
the aggregate market value of the Common Shares of the Registrant held by
non-affiliates was $38,348,345 and the aggregate market value of the Class B
Common Shares of the Registrant held by non-affiliates was $967,295 for a total
aggregate market value of all classes of Common Shares held by non-affiliates of
$39,315,640. While the Class B Common Shares are not listed for public trading
on any exchange or market system, shares of that class are convertible into
Common Shares at any time on a share-for-share basis. The market values
indicated were calculated based upon the last sale price of the Common Shares as
reported by the New York Stock Exchange on December 16, 1997, which was $8.75.
For purposes of this information, the 502,987 Common Shares and 2,674,830 Class
B Common Shares which were held by the officers and Directors of the Company
were deemed to be voting stock held by affiliates.

                       DOCUMENTS INCORPORATED BY REFERENCE

<TABLE>
<CAPTION>
DOCUMENT                                                                                         PART OF 10-K
--------                                                                                         ------------
<S>   <C>                                                                                           <C>
1.    Annual report to shareholders for the fiscal year ended September 30, 1997                    Parts I and II
      (only the portions listed in this report).
2.    Proxy statement for the annual meeting of shareholders to be held on February 14, 1998        Part III
      (only the portions listed in this report).
</TABLE>


<PAGE>   2


                           KEITHLEY INSTRUMENTS, INC.

                               10-K ANNUAL REPORT


                                TABLE OF CONTENTS

<TABLE>
<CAPTION>
PART I:                                                                                   PAGE
                                                                                          ----

<S               <C>                                                                      <C>
         Item 1.  Business                                                                  1
         Item 2.  Properties                                                                9
         Item 3.  Legal Proceedings                                                        10
         Item 4.  Submission of Matters to a Vote of Security Holders                      10

PART II:

         Item 5.  Market for the Registrant's Common Equity and Related
                    Stockholder Matters                                                    13
         Item 6.  Selected Financial Data                                                  13
         Item 7.  Management's Discussion and Analysis of Financial
                    Condition and Results of Operations                                    13
         Item 8.  Financial Statements and Supplementary Data                              13
         Item 9.  Changes in and Disagreements with Accountants on
                    Accounting and Financial Disclosure                                    13

PART III.

         Item 10. Directors and Executive Officers of the Registrant                       14
         Item 11. Executive Compensation                                                   14
         Item 12. Security Ownership of Certain Beneficial Owners and
                    Management                                                             14
         Item 13. Certain Relationships and Related Transactions                           14

PART IV:

         Item 14. Exhibits, Financial Statement Schedules and Reports on
                    Form 8-K                                                               15
</TABLE>



<PAGE>   3


                                                    PART I.

ITEM 1 - BUSINESS.
         ---------

General
-------

         Keithley Instruments, Inc. is a corporation which was founded in 1946
and organized under the laws of the State of Ohio on October 1, 1955. Its
principal executive offices are located at 28775 Aurora Road, Solon, Ohio 44139;
telephone (440) 248-0400. References herein to the "Company" or "Keithley" are
to Keithley Instruments, Inc. and its subsidiaries unless the context indicates
otherwise.

Products
--------

         Keithley Instruments, Inc. provides measurement-based solutions to the
semiconductor, telecommunications and electronic components manufacturers and
other high-growth areas of the electronics industry. Engineers and scientists
around the world use Keithley's advanced hardware and software for process
monitoring, production test and basis research. Although the Company's products
vary in capability, sophistication, use, size and price, they basically test,
measure, and analyze electrical and physical properties. As such, the Company
considers its business to be in a single industry segment. For each of the last
three fiscal years, more than 90% of the Company's revenue was derived from the
sale of electronic test and measurement instrumentation and data acquisition and
analysis hardware and software, which represents one class of similar products.

         The product groups of the Company are described below:

         INSTRUMENTS. The Instruments Business Unit designs, develops,
manufactures and markets sensitive electronic instrumentation used in production
test and research for measuring a wide range of electrical properties such as
voltage, resistance, current, capacitance and charge. The Instruments Business
Unit's products generally range in price from $1,000 to $10,000 and include the
following product groups:

             DIGITAL MULTIMETERS. This product line includes a range of
             instruments that are designed to cover measurements of voltage,
             resistance, and current for production test, design and
             development, and research applications. Each digital multimeter has
             a computer interface for integration into automated test and
             measurement systems. Typical applications include testing
             electrical components such as resistor networks and thermistors,
             and end products which include cellular telephones, computer disk
             drives, and pace makers.

             SENSITIVE INSTRUMENTS. This product group includes electrometers,
             picoammeters, sensitive digital voltmeters, micro-ohmmeters, and
             certain other instruments which are distinguished by their extreme
             sensitivity, resolution and accuracy as compared to the
             capabilities of conventional meters. Sensitive instruments are used
             by scientists, engineers, and researchers for the study of
             materials, semiconductors, and 



                                       1
<PAGE>   4



             superconductors. Typical customers are industrial and government
             research laboratories, educational institutions, and electronics
             manufacturers.

             SWITCHES AND SOURCES. Switching instruments are used to route
             electrical signals in test systems to measurement and source
             instrumentation. This allows many devices or test points to be
             measured with a minimum number of instruments. Switch products
             together with Sensitive, Digital Multimeter, Source, I-V and C-V
             instruments can be integrated into computer-based systems to
             provide flexible, automated testing and measurement. The switching
             product line allows Keithley to provide a complete measurement
             solution to customers in production test, semi-conductor
             characterization, and materials research applications.

             Sources generate the precise voltage and currents needed to test
             electronic devices and investigate properties of materials. Source
             products are sold to scientists and engineers in research,
             semiconductor and electronic manufacturing markets, especially
             where stable signals of low level current and voltage are needed.
             These sources can be interfaced with computers as part of an
             automated test system, or used manually on the laboratory bench.

             SOURCE MEASURE UNITS. These are programmable instruments capable of
             sourcing and measuring voltage and current, thus replacing the
             functionality of four instruments with one reliable, compact unit.
             These versatile instruments cover a wide dynamic range of voltage
             and current and their combination of high speed and resolution have
             made these units ideal for high volume production testing of
             electronic components for computers, automotive, and wireless
             telecommunications products. The source measure units also provide
             the measurement sensitivity needed for materials research and
             semiconductor characterization applications.

             C-V (CAPACITANCE VERSUS VOLTAGE). C-V products include
             high-frequency and quasistatic C-V meters, measurement and analysis
             software, and computer-based test systems. C-V products are used by
             scientists and engineers in semiconductor manufacturing facilities,
             industrial and governmental research laboratories, and educational
             institutions to research, develop, and characterize semiconductor
             devices, materials and manufacturing processes.

         SEMICONDUCTOR BUSINESS UNIT. The Semiconductor Business Unit designs,
develops, manufactures and markets automatic parametric test systems and process
monitoring solutions used by semiconductor manufacturers to measure various
electrical characteristics of semiconductor materials. Its products can be found
in semiconductor fabrication facilities throughout the world, and consist of two
main groups:

             APT PRODUCTS. The Company is one of the leading suppliers of these
             automatic parametric test systems for semiconductor production
             applications. In production, the systems allow manufacturers to
             monitor quality control parameters during fabrication of integrated
             circuits to improve manufacturing yields. In research, the systems
             are used to analyze the characteristics of semiconductor materials
             in the development of integrated circuit devices. The systems can
             also be used to develop 



                                       2
<PAGE>   5


             integrated circuit manufacturing processes. A typical system
             incorporates Keithley instrumentation and software and computer
             hardware manufactured by others. The system's major components are
             integrated, and in most cases, customized to customer
             specification. Installation and servicing of the equipment and
             software, and customer training are also provided. Selling prices
             for these products generally range from $100,000 to $250,000. In
             February 1996, Keithley purchased the principal assets of Turner
             Engineering Technology (Turner). Turner developed wafer test
             structures used for determining the quality of semiconductor wafers
             at various stages of manufacturing. These test structures will
             allow the company's APT systems to determine the quality of both
             the wafer and the manufacturing process much earlier than with
             previous test methods.

             OXIDE MONITORING SYSTEM. Quantox(R) is the first product based on
             the direct wafer measurement or non-contact technology licensed
             from International Business Machines in May 1994. The measurement
             data Quantox provides are used to detect and identify the types of
             charges present on semiconductor wafers. Charge is a critical
             indicator that tells the semiconductor production engineer whether
             or not the manufacturing process is "in spec." This measurement is
             made within minutes using Quantox, replacing a procedure that used
             to take up to five days. The selling price for a Quantox unit is
             approximately $500,000 depending upon the options purchased.

         RADIATION MEASUREMENTS BUSINESS UNIT. The Radiation Measurements
Business Unit designs, develops, manufactures, and markets products and systems
that accurately measure the radiation emission levels of x-ray machines and
nuclear radiation sources and are used to calibrate radiation therapy and x-ray
equipment in hospitals and manufacturing processes. Customers include hospitals,
diagnostic x-ray equipment manufacturers, radiation researchers and physicists,
and field service organizations. Selling prices for standard products range from
$500 to $10,500 per instrument. The Radiation Measurements Business Unit is
developing and producing personal dosimetry systems using recently acquired
laser thermoluminescence dosimetry for the U.S. Navy under contract and plans to
commercialize the technology over the next few years.


         PC MEASUREMENTS BUSINESS UNIT. This Business Unit designs, develops,
manufactures and markets a wide range of data acquisition and analysis hardware
and software products designed for use with personal computers and workstations.
These products are used in thousands of applications worldwide wherever a number
of variables must be monitored and analyzed quickly. Selling prices for these
products generally range from $100 to $4,000.

         These products are marketed under the brand names Keithley MetraByte
and Acculex and are composed of the following product groups:

             PLUG-IN DATA ACQUISITION BOARDS provide data acquisition
             capabilities in the form of a board that is installed into a slot
             of the computer. The Company offers a wide range of plug-in data
             acquisition boards in terms of the number of channels, input ranges
             and sampling rates. They are marketed worldwide to researchers and
             scientists engaged in laboratory automation and experimentation, as
             well as to engineers 



                                       3
<PAGE>   6


             involved with process control and data collection applications.
             These products are marketed primarily through direct marketing and
             catalog mailings.

             SOFTWARE products are specialized personal computer-based
             scientific data acquisition, analysis and graphics software
             products. Scientists and engineers often combine Keithley software
             together with data acquisition hardware or test and measurement
             instrumentation of other manufacturers. The software products are
             used with personal computers.

             ACCULEX products include digital panel meters and panel printers.
             These products display machine parameters, capture results for
             permanent storage and enunciate alarms. These products are marketed
             primarily through direct marketing and catalog mailings.

             DISTRIBUTED I/O products include Keithley's WORKHORSE and MetraBus
             product offerings. These products are primarily used in industrial
             monitoring and control applications.

             COMMUNICATION products include IEEE-488 bus interfaces and software
             for interfacing computers with programmable measurement
             instrumentation. These products are marketed through direct
             marketing and catalog mailings.

             DATA ACQUISITION INSTRUMENTS include personal computer-based
             workstations that collect data from, and provide control over, a
             variety of test and measurement modules. A typical workstation
             consists of a standard software package and hardware external to
             the personal computer that utilizes various plug-in module cards
             that allow a user to customize the workstation for a specific
             application, including research, product test and pilot plant
             process monitoring.

             PERSONAL COMPUTER INSTRUMENT PRODUCTS (PCIP) are instruments
             contained entirely on boards that fit into an expansion slot of
             almost any personal computer. Included in the PCIP offering are a
             digital multimeter, scanner oscilloscope, function generator and a
             counter. Applications include bench top engineering and automatic
             production testing. These products are marketed primarily through
             direct marketing and catalog mailings.

             SMARTLINK(TM) is a line of intelligent measurement modules that
             allow laboratory-grade measurements virtually anywhere due to their
             small size. The compact modules connect directly to a sensor or
             signal source creating no need for extra hardware. Each module has
             on-board signal processing capabilities to provide linearization,
             date/time stamping alarming that allows them to deliver useful
             information directly to a monitoring, control or data acquisition
             system. Selling prices for these products generally range from $500
             to $2,500.

         AGENCY PRODUCTS. The Company markets and distributes certain products
manufactured by approximately eight test and measurement companies. These
products are 


                                       4
<PAGE>   7


marketed and distributed primarily by the Company's European operations and are
complementary to, but not competitive with, products manufactured by the
Company.

New Products During Fiscal Year 1997
------------------------------------

         Several new products were introduced during fiscal 1997 including the
following:

         INSTRUMENTS introduced several new products including the Model 6517A,
2410 and 2420. The Model 6517A Electrometer/High Resistance Meter provides
accuracy, sensitivity and speed previously unavailable in this type of
instrument. The features of this model make it well-suited for measuring the
resistance, resistivity and conductance of insulating materials, finding the
voltage coefficient of resistors and characterizing the leakage of diodes and
capacitors. The Company expanded its 2400 SourceMeter Series with Model 2410, a
high voltage SourceMeter, and Model 2420, a high current SourceMeter. The new
instruments can make more than 1000 non-buffered readings per second. Both
models simultaneously source, sink and measure voltage and current, proving a
complete solution that simplifies and lowers the cost of measurement in a wide
range of applications.

         THE SEMICONDUCTOR BUSINESS UNIT began shipping a new parametric test
system, the Model S600. The S600 is designed for both production and
applications in the semiconductor industry. This product offers unprecedented
measurement speed and sensitivity, higher throughput and lower
cost-of-ownership. In the area of oxide charge monitoring, the Quantox process
monitoring product became more established.

         THE RADIATION MEASUREMENTS BUSINESS UNIT introduced software for
processing data and reporting results of tests on mammography x-ray machines to
the FDA and introduced its improved non-invasive kilovoltage divider used by
x-ray manufacturers and field service organizations worldwide. The Unit procured
a contract with the U.S. Navy worth $4.1 million for limited run initial
production of personnel dosimetry systems based on the newly acquired laser
heated thermoluminescence radiation dosimetry.

         PC MEASUREMENTS BUSINESS UNIT introduced the several additions to the
SmartLink(TM) product line. The unique design of the Models KNM-DCV41, -DCV42,
-TC41, and -TC42 provides up to 1500V front-to-back isolation on up to six
differential analog input channels. The instruments provide unparalleled
accuracy, plus equipment and personnel protection for demanding measurement
applications, such as DC volts readings, four-wire resistance tests, and
thermocouple temperature measurements. Also introduced was the KNM-DYN12 which
can make laboratory grade measurements of force, acceleration, and dynamic
pressure in virtually any plant location.

Geographic Markets and Distribution
-----------------------------------

         During fiscal 1997, substantially all of the Company's products were
manufactured in Ohio and were sold throughout the world in many developed
countries. The Company's 



                                       5
<PAGE>   8


principal markets are the United States, Europe and the Pacific Basin. During
the year, the Keithley Metrabyte operation was relocated from Taunton,
Massachusetts to Solon, Ohio.

         In the United States, the Company's products are sold by the Company's
sales personnel, independent sales representatives and through direct marketing
and catalog mailings. United States sales offices are located in Solon, Ohio and
Santa Clara, California. The Company markets its products directly in European
countries in which it has a wholly owned sales subsidiary and through
distributors in other countries. European subsidiaries have sales and service
offices located in or near London, Munich, Paris, Amsterdam, Zurich and Milan.
The Company also has sales offices in Belgium, China, Taiwan and India. Sales in
markets outside the above named locations are made through independent sales
representatives and distributors.

Sources and Availability of Raw Materials
-----------------------------------------

         The Company's products require a wide variety of electronic and
mechanical components, most of which are purchased. The Company has multiple
sources for the vast majority of the components and materials it uses; however,
there are some instances where the components are obtained from a sole-source
supplier. If a sole-source supplier ceased to deliver, the Company could
experience a temporary adverse impact on its operations; however, management
believes alternative sources could be developed quickly. Although shortages of
purchased materials and components have been experienced from time to time,
these items have generally been available to the Company as needed.

Patents
-------

         Electronic instruments of the nature the Company designs, develops and
manufactures can not generally be patented in their entirety. Although the
Company holds patents with respect to certain of its products, it does not
believe that its business is dependent to any material extent upon any single
patent or group of patents, because of the rapid rate of technological change in
the industry.

Seasonal Trends and Working Capital Requirements
------------------------------------------------

         Although the Company is not subject to significant seasonal trends, its
business is cyclical and is somewhat dependent upon the semiconductor industry
in particular. The Company does not have any unusual working capital
requirements.

Customers
---------

         The Company's customers generally are involved in engineering research
and development, product testing, electronic service or repair, and educational
and governmental research. During the fiscal year ended September 30, 1997 no
one customer accounted for more than 10% of the Company's sales. Management
believes that the loss of any one of its customers would not materially affect
the sales or net income of the Company.



                                       6
<PAGE>   9

Backlog
-------

         The Company's backlog of unfilled orders amounted to approximately
$13,486,000 as of September 30, 1997 and approximately $9,087,000 as of
September 30, 1996. Included in the 1997 backlog is $981,000 related to a U.S.
Navy Contract. $451,000 of this was unfunded at September 30, 1997. It is
expected that the majority of the orders included in the 1997 backlog will be
delivered during fiscal 1998; however, the Company's past experience indicates
that a small portion of orders included in the backlog may be canceled.

Competitive Conditions
----------------------

         The Company competes on the basis of quality, performance, service,
warranty and price, with quality and performance frequently being dominant.
There are many firms in the world engaged in the manufacture of electronic
measurement instruments, some of which are larger and have greater financial
resources than the Company. The Company's competitors vary between product lines
and certain manufacturers compete with the Company in multiple product lines.
The Company's principal competitors are Hewlett-Packard Company, National
Instruments, Inc., Fluke Corporation and Data Translation, Inc.


Research And Development
------------------------

         The Company's engineering development activities are directed toward
the development of new products that will complement, replace or add to the
products currently included in the Company's product line. The Company does not
perform basic research, but on an ongoing basis utilizes new component and
software technologies in the development of its products. The highly technical
nature of the Company's products and the rapid rate of technological change in
the industry require a large and continuing commitment to engineering
development efforts. Product development expenses were $17,233,000 in 1997,
$18,337,000 in 1996 and $15,385,000 in 1995, or approximately 14%, 15% and 14%
of net sales, respectively, for each of the last three fiscal years. During
1997, and continuing in 1998, the Company was involved in a design and
manufacturing, cost plus fixed fee, contract with the U.S. Navy. All contract
related costs were reimbursed by the U.S. Navy and appear in the "Cost of goods
sold" caption in the consolidated financial statements as opposed to "Product
development expenses." The Company acquired the principal assets of
International Sensor Technology (IST) in 1996. IST's activities included a
government research and development contract for the Navy which was concluded
during 1996. The amount spent by the Company on this contract was accounted for
in the manner described for the current contract.

Government Regulations
----------------------

         The Company believes that its current operations and its current uses
of property, plant and equipment conform in all material respects to applicable
laws and regulations. The Company has not experienced, nor does it anticipate,
any material claim or material capital expenditure in connection with
environmental laws and other regulations.



                                       7
<PAGE>   10


Employees
---------

         As of September 30, 1997, the Company employed 693 persons, 99 of whom
were located outside the United States. None of the Company's employees are
covered under the terms of a collective bargaining agreement and the Company
believes that relations with its employees are good.

Foreign Operations and Export Sales
-----------------------------------

         Information related to foreign and domestic operations and export sales
is incorporated by reference to Note I of the Notes to the Consolidated
Financial Statements on page 29 of the Company's 1997 Annual Report to
Shareholders, a copy of which is filed as Exhibit 13 to this report.

         The Company has significant revenues from outside the United States
which increase the complexity and risk to the Company. These risks include
increased exposure to the risk of foreign currency fluctuations and the
potential economic and political impacts from conducting business in foreign
countries. With the exception of changes in the value of foreign currencies,
which is not possible to predict, the Company believes that its foreign
subsidiaries and other larger international markets are in countries where the
economic and political climate is generally stable.



                                       8
<PAGE>   11

ITEM 2 - PROPERTIES.
         -----------

         The Company believes that the facilities owned and leased by it are
well maintained, adequately insured and suitable for their present and intended
uses. Pertinent information concerning the principal properties of the Company
and its subsidiaries is as follows:


<TABLE>
<CAPTION>
                               Type of                                                  Acreage (Land)
Owned Properties               Facility                                            Square Footage (Building)
----------------               --------                                            -------------------------

<S>                            <C>                                                  <C>
     Location
     --------

     Solon, Ohio               Executive offices,
                               Engineering, Manufacturing,                          26.1 Acres
                               Marketing and Sales                                  125,000 square feet

     Solon, Ohio               Engineering, Manufacturing,
                               Marketing, Sales, Service and                        7.0 Acres
                               Administration                                       76,000 square feet

     Solon, Ohio               Marketing and Administration,                        5.5 Acres
                               Space is available for expansion with                50,000 square feet
                               the majority leased to other parties.                (4,000 square feet
                                                                                    utilized by the Co.)
</TABLE>

<TABLE>
<CAPTION>
                                                                                               Lease
                               Type of                                       Square          Expiration
Leased Properties              Facility                                      Footage            Date
-----------------              --------                                      -------            ----

<S>                            <C>                                            <C>           <C>
     Location
     --------

     Solon, Ohio               Engineering, Manufacturing,                    40,000        October 13, 2006
                               Marketing, Sales, Service
                               and Administration

     Solon, Ohio               Manufacturing, and                             21,600        March 31, 2002
                               Administration


     Santa Clara,              Sales and Service                               4,355        October 13, 2002
     California
</TABLE>



                                       9
<PAGE>   12


<TABLE>
<CAPTION>
                                                                                           Lease
                               Type of                                Square            Expiration
Location                       Facility                              Footage               Date
--------                       --------                              -------               ----

<S>                            <C>                                     <C>            <C>
Munich,                        Sales, Service and                      27,750         March 31, 2001;
Germany                        Administration                                         renewable

London, England                Sales and Service                        5,600         July 24, 2009

Paris, France                  Sales and Service                        3,456         June 30, 1998

Zurich,                        Sales and Service                        3,229         September 30, 1998
Switzerland                                                                           renewable

Amsterdam,                     Sales and Service                        2,906         March 31, 2002
Netherlands

Milan,                         Sales and Service                        2,691         August 31, 2001
Italy
</TABLE>


ITEM 3 - LEGAL PROCEEDINGS.
         ------------------

         The Company is not a party to any material litigation.

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

         Not applicable.


                                       10
<PAGE>   13


EXECUTIVE OFFICERS OF THE REGISTRANT:
-------------------------------------

         The description of executive officers is included pursuant to
Instruction 3 to Section (b) of Item 401 of Regulation S-K under the Securities
and Exchange Act of 1934.

         The following table sets forth the names of all executive officers of
the Company and certain other information relating to their position held with
the Company and other business experience.

<TABLE>
<CAPTION>
Executive Officer                Age         Recent Business Experience
-----------------                ---         --------------------------

<S>                               <C>        <C>
Joseph P. Keithley                49         Chairman of the Board of Directors since 1991, Chief
                                             Executive Officer since November 1993 and President since
                                             May 1994.

Philip R. Etsler                  47         Vice President Human Resources of the Company since 1990.

James B. Griswold                 51         Secretary and a Director of the Company since 1988;
                                             partner in the law firm of Baker & Hostetler LLP from 1982
                                             to present.

Hermann Hamm (1)                  58         Vice President of European Operations of the Company since
                                             1986.

Frederick R. Hume (1)             54         Senior Vice President Strategic Planning and Technology
                                             since November  1996. Previously Senior Vice President
                                             Test Instrumentation Group from February 1993 to October
                                             1996. Vice President Test Instrumentation  Group from
                                             August 1992 to February  1993.  Vice  President Instrument
                                             Division of the Company from May 1988 to August 1992.

Mark J. Plush                     48         Controller since 1982 and Officer of the Company since
                                             1989.

Ronald M. Rebner                  53         Vice President and Chief Financial Officer of the Company
                                             since 1981.
</TABLE>



                                       11
<PAGE>   14


<TABLE>
<CAPTION>
Executive Officer                           Age         Recent Business Experience
-----------------                           ---         --------------------------
<S>                                          <C>        <C>
Gabriel A. Rosica                            57         Senior Vice President since February 1996. Previously
                                                        Chief Operating Officer of Bailey Controls Company from
                                                        August 1994 to January  1996 and Senior Vice President of
                                                        Systems Operations of Bailey Controls Company from January
                                                        1992 to July 1994.

Terrence E. Sheridan                         57         Vice President Radiation  Measurements Business Unit since
                                                        1978.
</TABLE>



(1) Subsequent to September 30, 1997, Mr. Hamm and Mr. Hume resigned from their
    Executive Officer positions with the Company.


                                       12
<PAGE>   15


                                    PART II.

ITEM 5 - MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER 
         -----------------------------------------------------------------
         MATTERS.
         --------

         The information required by this Item is incorporated herein by
reference under the caption Stock Market Price and Cash Dividends appearing on
page 31 of the Keithley Instruments, Inc. 1997 Annual Report to Shareholders, a
copy of which is filed as Exhibit 13 to this Report.

         The approximate number of shareholders of record of Common Shares and
Class B Common Shares, including those shareholders participating in the
Dividend Reinvestment Plan, as of December 16, 1997 was 2,394.

ITEM 6 - SELECTED FINANCIAL DATA.
         ------------------------

         The information required by this Item is incorporated herein by
reference to the eleven year summary, appearing on pages 32 and 33 of the
Keithley Instruments, Inc. 1997 Annual Report to Shareholders, a copy of which
is filed as Exhibit 13 to this Report.

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

         The information required by this Item is incorporated herein by
reference to pages 21 through 23 of the Keithley Instruments, Inc. 1997 Annual
Report to Shareholders, a copy of which is filed as Exhibit 13 to this Report.

ITEM 8 - FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.
         --------------------------------------------

         The Consolidated Financial Statements, appearing on pages 18 through 20
and pages 23 through 29, the Unaudited Quarterly Results of Operations appearing
on page 31 of the Keithley Instruments, Inc. 1997 Annual Report to Shareholders,
together with the report thereon of Price Waterhouse LLP dated November 17,
1997, appearing on page 30 of the Keithley Instruments, Inc. Annual Report to
Shareholders is filed as Exhibit 13 to this Report.

ITEM 9 - CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND 
         ---------------------------------------------------------------
         FINANCIAL DISCLOSURE.
         ---------------------

         None.


                                       13
<PAGE>   16


                                    PART III.

ITEM 10 - DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.
          ---------------------------------------------------

         The information required by this item relating to the Directors is
incorporated herein by reference to the information set forth under the caption
Election of Directors in the Company's Proxy Statement to be used in conjunction
with the February 14, 1998 Annual Meeting of Shareholders and filed with the
Securities and Exchange Commission pursuant to Section 14(a) of the Securities
Exchange Act of 1934. The information required for an identification of
executive officers is included on pages 11 and 12 of this Form 10-K Annual
Report.

ITEM 11 - EXECUTIVE COMPENSATION.
          -----------------------

         The information required by this item relating to executive
compensation is incorporated herein by reference to the information set forth
under the caption Executive Compensation and Benefits in the Company's Proxy
Statement to be used in conjunction with the February 14, 1998 Annual Meeting of
Shareholders and filed with the Securities and Exchange Commission pursuant to
Section 14(a) of the Securities Exchange Act of 1934.

ITEM 12 - SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.
          ---------------------------------------------------------------

         The information required by this item relating to security ownership of
certain beneficial owners and management is incorporated herein by reference to
the information set forth under the caption Principal Shareholders in the
Company's Proxy Statement to be used in conjunction with the February 14, 1998
Annual Meeting of Shareholders and filed with the Securities and Exchange
Commission pursuant to Section 14(a) of the Securities Exchange Act of 1934.


ITEM 13 - CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.
          -----------------------------------------------

         James B. Griswold, a Director and nominee for Director, is a partner in
the law firm of Baker & Hostetler LLP. Baker & Hostetler LLP served as general
legal counsel to the Company during the fiscal year ended September 30, 1997,
and is expected to render services in such capacity to the Company in the
future.



                                       14
<PAGE>   17


                                    PART IV.

ITEM 14 - EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.
          ----------------------------------------------------------------

(a)(1)  FINANCIAL STATEMENTS OF THE COMPANY

         The following documents are filed as part of this report:

1. Consolidated Balance Sheet as of September 30, 1997 and 1996.

2. Consolidated Statement of Income for the years ended September 30, 1997, 1996
   and 1995.

3. Consolidated Statement of Cash Flows for the years ended September 30, 1997,
   1996 and 1995.

4. Consolidated Statement of Shareholders' Equity for the years ended September
   30, 1997, 1996 and 1995.

5. Notes to Consolidated Financial Statements.

6. Report of Independent Accountants dated November 17, 1997.

(a)(2)  FINANCIAL STATEMENT SCHEDULES

The following additional information should be read in conjunction with the
Consolidated Financial Statements of the Company described in Item 14(a)(1):

Schedule II  Valuation and Qualifying Accounts

Schedules other than those listed above are omitted because they are not
required or not applicable, or because the information is furnished elsewhere in
the consolidated financial statements or the notes thereto.


                                       15
<PAGE>   18


(a)(3)  INDEX TO EXHIBITS

<TABLE>
<CAPTION>
                                                                                                            Page Number
                                                                                                            Sequential
          Exhibit                                                                                            Numbering
          Number                  Exhibit                                                                     System
          ------                  -------                                                                     ------

<S>                     <C>                                                                                      <C>
          3(a)          Amended Articles of Incorporation, as amended on February 11, 1985. 
                        (Reference is made to Exhibit 3(a) of the Company's Form 10 Registration 
                        Statement (File No. 0-13648) as declared effective on July 31, 1985, which
                        Exhibit is incorporated herein by reference.)
                                                                                                                 --
          3(b)          Code of Regulations, as amended on February 11, 1985.  (Reference is made to
                        Exhibit 3(b) of the Company's Form 10 Registration Statement (File No. 0-13648) as
                        declared effective on July 31, 1985, which Exhibit is incorporated herein by
                        reference.)                                                                              --

          3(c)          Amended Articles of Incorporation, as amended on February 10, 1996.  (Reference is
                        made to Exhibit 3(c) of the Company's Quarterly Report on Form 10-Q for the fiscal
                        quarter ended March 31, 1996 (File No. 1-9965), which Exhibit is incorporated
                        herein by reference.)                                                                    --

          4(a)          Specimen Share Certificate for the Common Shares, without par value.  (Reference
                        is made to Exhibit 4(a) of the Company's Quarterly Report on Form 10-Q for the
                        fiscal quarter ended June 30, 1988 (File No. 1-9965), which Exhibit is
                        incorporated herein by reference.)                                                       --

          4(b)          Specimen Share Certificate for the Class B Common Shares, without par value.
                        (Reference is made to Exhibit 4(b) of the Company's Form 10 Registration Statement
                        (File No. 0-13648) as declared effective on July 31, 1985, which Exhibit is
                        incorporated herein by reference.)                                                       --

          *10(a)        1984 Stock Option Plan, adopted in February 1984.                                        --

          *10(c)        1984 Deferred Compensation Plan, adopted in February 1984.                               --

<FN>
                        *Reference is made to the appropriate Exhibits of the Company's Form 10 
                        Registration Statement (File No. 0-13648) as declared effected on July 31, 1985, 
                        which Exhibits are incorporated herein by reference.
</TABLE>



                                       16
<PAGE>   19



<TABLE>
<CAPTION>
                                                                                                            Page Number
                                                                                                            Sequential
          Exhibit                                                                                            Numbering
          Number                  Exhibit                                                                     System
          ------                  -------                                                                     ------

<S>                     <C>                                                                                      <C>
          10(k)         Employment Agreement with Joseph F. Keithley dated September 26, 1988. 
                        (Reference is made to Exhibit 10(k) of the Company's Annual Report on Form 
                        10-K for the year ended September 30, 1988 (File No. 1-9965), which
                        Exhibit is incorporated herein by reference.)                                            --

          10(l)         Employment Agreement with Joseph P. Keithley dated September 26, 1988. 
                        (Reference is made to Exhibit 10(l) of the Company's Annual Report on Form 
                        10-K for the year ended September 30, 1988 (File No. 1-9965), which
                        Exhibit is incorporated herein by reference.)                                            --

          10(o)         Form of Supplemental Executive Retirement Plan, adopted in January 1988. 
                        (Reference is made to Exhibit 10(o) of the Company's Annual Report on 
                        Form 10-K for the year ended September 30, 1988 (File No. 1-9965), which
                        Exhibit is incorporated herein by reference.)                                            --

          10(q)         1992 Stock Incentive Plan, adopted in December 1991.  (Reference is made to
                        Exhibit 10(q) of the Company's Annual Report on form 10-K for the year ended
                        September 30, 1991 (File No. 1-9965) which Exhibit is incorporated herein by
                        reference.)                                                                              --

          10(r)         1992 Directors' Stock Option Plan, adopted in December 1991.  (Reference is made
                        to Exhibit 10(r) of the Company's Annual Report on form 10-K for the year ended
                        September 30, 1991 (File No. 1-9965) which Exhibit is incorporated herein by
                        reference.)                                                                              --

          10(u)         Credit Agreement dated as of May 31, 1994 by and among Keithley Instruments, Inc. 
                        and certain borrowing subsidiaries and the Banks named herein, and NBD Bank,
                        N.A., as Agent. (Reference is made to Exhibit 10(u) of the Company's Quarterly 
                        Report on form 10-Q for the quarter ended June 30, 1994 (File No. 1-9965) which
                        Exhibit is incorporated herein by reference.)                                            --
</TABLE>


                                       17




<PAGE>   20





<TABLE>
<CAPTION>
                                                                                                            Page Number
                                                                                                            Sequential
          Exhibit                                                                                            Numbering
          Number                  Exhibit                                                                     System
          ------                  -------                                                                     ------

<S>                     <C>                                                                                     <C>
          10(v)         Contactless Testing Technology Licensing Agreement between International 
                        Business Machines Corporation and Keithley Instruments, Inc., effective as 
                        of May 26, 1994. (Reference is made to Exhibit 10(v) of the Company's Annual 
                        Report on form 10-K for the year ended September 30, 1994 (File No. 1-9965) 
                        which Exhibit is incorporated herein by reference.)                                      --

          10(x)         1996 Outside Directors Deferred Stock Plan.  (Reference is made to Exhibit 10(x)
                        of the Company's Quarterly Report on Form 10-Q for the fiscal quarter ended
                        March 31, 1996 (File No. 1-9965), which Exhibit is incorporated herein by
                        reference.)                                                                              --

          10(y)         First Amendment dated March 28, 1997, to the Credit Agreement dated May 31, 1994. 
                        (Reference is made to Exhibit 10(y) of the Company's Quarterly Report on Form
                        10-Q for the fiscal quarter ended March 31, 1997 (File No. 1-9965), which Exhibit 
                        is incorporated herein by reference.)
                                                                                                                 --
          10(z)         1997 Directors' Stock Option Plan, adopted in February 1997.                            22-24

          11            Statement Re Computation of Per Share Earnings.                                          25

          13            Annual Report to Shareholders for the Fiscal Year Ended September 30, 1997.
                                                                                                                26-60
          21            Subsidiaries of the Company.                                                             61

          23            Consent of Experts.                                                                      62

          27            Financial Data Schedule (EDGAR version only).                                            --
</TABLE>


ITEM 14(B)  REPORTS ON FORM 8-K.

No reports on Form 8-K were filed during the last quarter of the Company's
fiscal year ended September 30, 1997.

ITEM 14(C)  EXHIBITS:  See "Index to Exhibits" at Item 14(a)(3) above.

ITEM 14(D) FINANCIAL STATEMENT SCHEDULES: Schedules required to be filed in
response to this portion of Item 14 are listed above in Item 14(a)(2).


                                       18
<PAGE>   21


                                   SIGNATURES

         Pursuant to the requirements of Section 13 or 15(d) 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.

Keithley Instruments, Inc.
(Registrant)

By:   /s/  Joseph P. Keithley
     -----------------------------
           Joseph P. Keithley, (Chairman, President and Chief Executive Officer)

Date:   December 5, 1997
     -----------------------------

         Pursuant to the requirements of the Securities Exchange Act of 1934,
this report has been signed below by the following persons on behalf of the
Registrant and in the capacities on the date indicated.

<TABLE>
<CAPTION>
Signature                                      Title                                                       Date
---------                                      -----                                                       ----

<S>                                            <C>                                                        <C>
/s/  Joseph P. Keithley                        Chairman of the Board of Directors, President and          12/5/97
--------------------------------------------   Chief Executive Officer
     Joseph P. Keithley                        (Principal Executive Officer)

--------------------------------------------   Founder and Director                                       12/5/97
     Joseph F. Keithley

/s/  Ronald M. Rebner                          Vice President and Chief Financial Officer (Principal      12/5/97
--------------------------------------------   Financial and Accounting Officer) and a Director
     Ronald M. Rebner                       

/s/  Brian R. Bachman                          Director                                                   12/5/97
--------------------------------------------
     Brian R. Bachman

                                               Director                                                   12/5/97
--------------------------------------------
     James T. Bartlett

/s/  Arden L. Bement, Jr.                      Director                                                   12/5/97
--------------------------------------------
     Dr. Arden L. Bement, Jr.

/s/  James B. Griswold                         Director                                                   12/5/97
--------------------------------------------
     James B. Griswold

/s/  Leon J. Hendrix, Jr.                      Director                                                   12/5/97
--------------------------------------------
     Leon J. Hendrix, Jr.

/s/  R. Elton White                            Director                                                   12/5/97
--------------------------------------------
     R. Elton White
</TABLE>



                                       19
<PAGE>   22


Report of Independent Accountants on
Financial Statement Schedule



To the Board of Directors of
Keithley Instruments, Inc.


Our audits of the consolidated financial statements referred to in our report
dated November 17, 1997 appearing on page 30 of the 1997 Annual Report to
Shareholders of Keithley Instruments, Inc., (which report and consolidated
financial statements are incorporated by reference in this Annual Report on Form
10-K) also included an audit of the Financial Statement Schedule listed in Item
14(a)(2) of this Form 10-K. In our opinion, this Financial Statement Schedule
presents fairly, in all material respects, the information set forth therein
when read in conjunction with the related consolidated financial statements.




PRICE WATERHOUSE LLP

Cleveland, Ohio
November 17, 1997



                                       20
<PAGE>   23


                                                                     SCHEDULE II
                           KEITHLEY INSTRUMENTS, INC.
                        VALUATION AND QUALIFYING ACCOUNTS
                            (In Thousands of Dollars)




<TABLE>
<CAPTION>
Column A                               Column B               Column C              Column D               Column E
--------                               --------               --------              --------               --------
                                      Balance at            Charged to 
                                      Beginning                Costs                                    Balance at End
Description                           of Period             and Expenses         Deductions (1)           of Period
-----------                           ---------             ------------         --------------           ---------


<S>                                     <C>                     <C>                   <C>                   <C>   
For the Year Ended 
September 30, 1997:

Valuation allowance for
deferred tax assets                     $2,994                  $172                   --                   $3,166

For the Year Ended September
30, 1996:

Valuation allowance for
deferred tax assets                     $2,606                  $467                   $79                  $2,994

For the Year Ended September
30, 1995:

Valuation allowance for
deferred tax assets                     $3,330                  $ 80                 $ 804                  $2,606
</TABLE>


(1)   Represents utilization of foreign tax credits.


                                       21