SECURITIES AND EXCHANGE COMMISSION
                                 Washington, DC

                                  Form 10-QSB

                 Quarterly Report under Section 13 or 15(d) of
                      the Securities Exchange Act of 1934

     For the quarter ended September 30, 1997    Commission File No. 0-774

                              DANIEL GREEN COMPANY
             (Exact name of registrant as specified in its charter)

        MASSACHUSETTS                                 15-0327010
 (State or other jurisdiction of         (IRS Employer Identification No.)
 incorporation or organization)

         ONE MAIN STREET
      DOLGEVILLE, NEW YORK                         13329
 (Address of principal executive offices)        (Zip Code)

       Registrant's telephone number, including area code: (315) 429-3131

         Former name, former address and former fiscal year, if changed
                            since last report: None.

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 Act of 1934 during the preceding twelve months and (2)
has been subject to the filing requirements for at least the past
90 days.       YES  X    NO

              CLASS                    OUTSTANDING AT SEPTEMBER 30, 1997

    Common Stock $2.50 par value               1,511,892 Shares


<PAGE>




DANIEL GREEN COMPANY

INDEX
                                                          Page
                                                         Number

Index     . . . . . . . . . . . . . ...... . . . . . . . . . 1

PART I - Financial Statements

Balance Sheets, Assets
      September 30, 1997 & December 31, 1996   . . . . . . . 2

Balance Sheets, Liabilities & Stockholders' Equity
      September 30, 1997 & December 31, 1996   . . . . . . . 3
Statements of Operations for the three & nine month
      periods ended September 30, 1997 & 1996  . . . . . . . 4

Statements of Cash Flows for the nine months ended
      September 30, 1997 & 1996  . . . . . . . . . . . . . . 5

Notes to Financial Statements ...... . . . . . . . . . . . . 6

Management Discussion & Analysis of Financial Condition
      and Results of Operations . ...... . . . . . . . . . . 7

PART II - Other Information   . . . . . ...... . . . . . . . 9


                                       1
<PAGE>


                              DANIEL GREEN COMPANY

                                 Balance Sheets

                                     ASSETS

                                                        Sept 30,     December 31
                                                         1997           1996
                                                      (Unaudited)        (*)
                                          
Current Assets:

Cash                                                   $     9,655   $    13,213

Accounts Receivable, trade
 less allowances for doubtful accounts
 (1997 - $222,487  1996 - $200,000)                      6,090,667     6,582,081

Income Tax Refund Receivable                               256,738       157,704

Inventories, at lower of cost (FIFO) or market:
     Raw Materials                                       1,978,895     2,026,140
     Work In Process                                       581,896     1,351,945
       Finished Goods                                    7,419,736     5,075,618
                                                       -----------   -----------
       Total Inventories                                 9,980,527     8,453,703

Other Current Assets                                        97,667        69,479
                                                       -----------   -----------

Total Current Assets                                    16,435,254    15,276,180


Property, plant & equipment:

Real Estate and Water Power, at cost                     3,336,554     3,270,968
Machinery, Equipment, & Lasts, at cost                   5,527,214     5,427,718
                                                       -----------   -----------
                                                         8,863,768     8,698,686
Less: Accumulated Depreciation                           7,153,177     6,900,371
                                                       -----------   -----------
Property, plant, & equipment-net                         1,710,589     1,798,315


Other Assets:
Prepaid Pension Expense                                  2,375,369     2,375,369
Other Assets                                               101,296       114,963
                                                       -----------   -----------

Total Other Assets                                       2,476,665     2,490,332


Total Assets                                           $20,622,508   $19,564,827
                                                       ===========   ===========

(*)  Derived from Audited Financial Statements.
     See notes to financial statements.


                                       2


<PAGE>
                              DANIEL GREEN COMPANY

                                 Balance Sheets

                       Liabilities & Stockholders' Equity

                                            Sept 30     December 31
                                              1997         1996
                                          (Unaudited)       (*)
Current Liabilities:

Notes Payable, line of credit             $ 5,565,438   $ 4,537,856
Notes Payable, current                        808,435       591,979
Accounts Payable, trade                       760,463       480,130
Accrued Salaries & Commissions                 58,995       209,427
Accrued Cooperative Advertising               469,854       307,909
Other Accrued Liabilities                      51,037       119,123
Deferred Income Tax Liability                 258,193       258,193
Capital Lease Obligation, current               3,950        23,480
                                            ---------     ---------

Total Current Liabilities                   7,976,365     6,528,097

Notes Payable, non-current                  1,735,907     1,708,240
Deferred Tax Liability                        262,716       262,716
                                            ---------     ---------


Total Liabilities                           9,974,988     8,499,053


Stockholders' Equity

Common Stock                                3,779,730    3,779,730
Paid-in-excess of par value                   312,500      312,500
Retained Earnings                           6,555,290    6,973,544
                                            ---------    ---------
Total Stockholders' Equity                 10,647,520   11,065,774


Total Liabilities & Stockholders' Equity  $20,622,508 $ 19,564,827
                                           ==========   ==========




(*)  Derived from Audited Financial Statements.
     See notes to financial statements.


                                       3
<PAGE>
<TABLE>
<CAPTION>
                              DANIEL GREEN COMPANY

                            Statements of Operations
                                   (Unaudited)

                                     For the                         For the
                                Three Months Ended              Nine Months Ended
                              Sept 30        Sept 30         Sept 30         Sept 30
                               1997            1996           1997             1996


<S>                        <C>             <C>             <C>             <C>         
Net Sales                  $  5,610,869    $  7,341,607    $ 13,280,759    $ 15,125,224

Costs and Expenses:

 Cost of Goods Sold           4,066,245       5,366,797       9,564,334      11,282,725
 Selling, General,
 & Administrative             1,323,288       1,470,607       3,992,706       4,054,494
 Interest Expense               148,537         187,255         398,322         622,897
                           ------------    ------------    ------------    ------------

Total Costs & Expenses        5,538,070       7,024,659      13,955,362      15,960,116

Income (Loss) before
 credit for Income Taxes         72,799         316,948        (674,603)       (834,892)

(Provision) Credit
       for Income Taxes         (27,664)       (120,440)        256,349         317,259
                           ------------    ------------    ------------    ------------

Net Income (Loss)                45,135    $    196,508    ($   418,254)   ($   517,633)
                           ============    ============    ============    ============

Net Income (Loss)
        per Share                 $0.03          $0.13           ($0.28)         ($0.43)
                           ============    ============    ============    ============


Shares Outstanding            1,511,892       1,511,892       1,511,892       1,195,225

</TABLE>


                       See notes to financial statements.

                                       4


<PAGE>

                              DANIEL GREEN COMPANY
                            Statements of Cash Flows
                                   (Unaudited)

                                                For the Nine Months Ended
                                                Sept 30         Sept 30
                                                   1997          1996
Operating Activities:
 Net Loss                                     $  (418,254)   $  (517,633)

 Adjustments  to reconcile  net loss to net
 cash provided by (used in) operating
 activities:
   Depreciation                                   252,806        254,291
   Amortization                                    18,402         18,402
   Net Pension Credit                                   0        (54,623)

Changes in assets & liabilities:
 (increases) decreases in:
   Accounts Receivable, trade                     491,414        347,324
   Income Tax Refund Receivable                   (99,034)       132,563
   Inventories                                 (1,526,824)       623,141
   Other Current Assets                           (28,188)       124,240
   Other Assets                                    (4,733)        (3,872)
increases (decreases) in:
  Accounts Payable, trade                         280,333      1,118,295
  Accrued Salaries & Commissions                 (150,432)      (125,070)
  Accrued Cooperative Advertising                 161,945       (100,000)
  Other Accrued Liabilities                       (68,086)       (37,783)
                                              -----------    -----------
 Net Cash Provided (Used)
  by Operating Activities:                     (1,090,651)     1,779,275
                                              -----------    -----------

Investing Activities:
  Purchase of property & equipment               (165,082)      (105,405)
  Disposal of property & equipment                      0         75,509
                                              -----------    -----------
Net Cash Used in Investing Activities:           (165,082)       (29,896)
                                              -----------    -----------

Financing Activities:
  Net Borrowings (Payments) on
     Line of Credit                             1,027,582     (2,784,646)
  Net Borrowings and
     Repayments of Notes Payable                  244,123       (486,717)
  Principal payments under capital lease          (19,530)         3,786
  Net Proceeds of Issuance of Common Stock              0      1,500,000
                                              -----------    -----------

Net Cash Provided by (Used)
 in Financing activities                        1,252,175     (1,767,577)

Net (Decrease) in Cash                             (3,558)       (18,198)

Cash at Beginning of Period                        13,213         29,762
                                              -----------    -----------
Cash at End of Period                         $     9,655    $    11,564
                                              ===========    ===========

                  See notes to financial statements.

                                       5

<PAGE>

DANIEL GREEN COMPANY

Notes to Financial Statements


Note 1.  In the opinion of the Company,  the  accompanying  unaudited  financial
         statements  contain  adjustments,  all of  which  are of a  normal  and
         recurring nature, necessary to present fairly the financial position as
         of September 30, 1997 and the results of operations  and cash flows for
         the three and nine months then ended.

Note 2.  The results of operations for the three and nine months ended September
         30, 1997 are not  necessarily  indicative of the results to be expected
         for the full year.

Note 3.  In  March  1997,  the  Financial   Accounting  Standards  Board  issued
         Statement of  Financial  Accounting  Standards  No.128,  "Earnings  per
         Share," which is effective for  financial  statements  for both interim
         and annual periods  ending after  December 15, 1997.  This new standard
         requires  dual  presentation  of basic and diluted  earnings  per share
         (EPS)  on  the  face  of  the   earnings   statement   and  requires  a
         reconciliation  of the numerators and denominators of basic and diluted
         EPS calculations.  The Company's  current EPS calculations  conforms to
         basic EPS. Diluted EPS will not be materially  different from basis EPS
         since the issuance of common shares upon exercise of outstanding  stock
         options would not be materially dilutive.

Note 4.  In June  1997,  FASB  issued  SFAS No.  130,  "Reporting  Comprehensive
         Income" and SFAS No. 131,  "Disclosures about Segments of an Enterprise
         and  Related   Information."  SFAS  No.130  establishes  standards  for
         reporting and disclosure of  comprehensive  income and in components in
         financial  statement  format.  Comprehensive  income is  defined as the
         change  in  equity  of a  business  enterprise  during  a  period  from
         transactions and other events and circumstances  from nonowner sources.
         Items considered comprehensive income including foreign currency items,
         minimum pension  liability  adjustments and unrealized gains and losses
         on certain  investments in debt and equity securities.  SFAS No. 130 is
         effective for financial  statements  for fiscal years  beginning  after
         December 15, 1997. The Company is currently evaluating what impact this
         standard will have on its disclosure.

Note 5.  SFAS No. 131 established  standards for the reporting information about
         operating  segments by public entities in annual  financial  statements
         and requires that those  entities  report  selected  information  about
         operating   segments   in   interim   financial   reports   issued  for
         shareholders.   This  Statement   supersedes  SFAS  No,  14,  Financial
         Reporting for Segments of a Business Enterprise and amends SFAS No. 94,
         "Consolidation  of   All-Majority-Owned-Subsidiaries."   SFAS  No.  131
         requires  that  public  entities   report   financial  and  descriptive
         information about its reportable  business segments.  This statement is
         effective for financial statements for periods beginning after December
         15, 1997. The Company is currently evaluating what impact this standard
         will have on its disclosures.

                                       6

<PAGE>

DANIEL GREEN COMPANY

Management Discussion & Analysis of Financial Condition
and Results of Operations


1.   Liquidity and Capital Resources

         Cash flow used by operations for the first nine months of 1997 was $1.1
million  compared with $1.8 million  provided by  operations  for the first nine
months of 1996.  This  decrease  in cash was the  result of higher  inventories,
lower  income,   and  offset  by  accounts   receivable  and  accounts  payable.
Inventories  increased by $1.5 million or 18% over the historical low balance at
December 31, 1996.  When  compared to September 30, 1996,  the  inventory  value
on-hand at September 30, 1997 is 2.9% lower,  but,  changes have occurred within
each  inventory   category.   Raw  materials  and   work-in-process   have  been
significantly  reduced  in  comparison  with  last year  and  reflect  curtailed
production  activity.  Finished  goods has increased by 12.4% due to lower sales
demand, but a larger percentage of stock reflects imported footwear.

         The Company's  line of credit at September 30, 1997 is $5.6 million and
remains relatively  unchanged as compared to $5.5 million at September 30, 1996.
The  increase  in  short  term  borrowings  reflects  the  Company's  additional
borrowings to finance inventory.

         In  comparison  to the first  nine  months  of 1996,  the  Company  has
increased  capital  expenditures  in 1997 by $59,677.  These  expenditures  were
primarily made to upgrade computer systems.

         The Company's  borrowing  requirements for working capital purposes are
seasonal with peak borrowing periods between June and mid September. On July 17,
1997 the Company obtained a short term loan from Riedman Corporation, which owns
approximately 31% of the Company's  outstanding shares. Under the loan agreement
with  Riedman  Corporation,  the Company was allowed to receive and borrow up to
$1,000,000,  at a fixed rate per annum equal to the prime rate  published in the
Wall Street  Journal on the date of the agreement,  plus two percentage  points.
Total advances under this loan  agreement  through  September 30, 1997 have been
$500,000,  and the  Company  does  not  anticipate  additional  borrowings.  All
outstanding  amounts were paid to Riedman  Corporation on October 31, 1997, from
funds received after the termination of the Company's defined benefit plan.

         Subsequent to December 31, 1996,  the Company  elected to terminate its
defined benefit pension plan and implement a defined contribution 401(k) savings
plan. The Company has completed its analysis of the financial  statement  effect
of terminating the plan and concluded that it will have a positive effect on the
Company's financial position and results of operations.

         Management  is not aware of any known  demands,  commitments  or events
which  would  materially  affect  its  liquidity,  and  there  are  no  material
expenditures  or  commitments   which  would  affect  capital   resources  in  a
significant  way.  Cash  generated by  operations,  supplemented  by  short-term
borrowings, should cover planned requirements.

         In  March  1997,  the  Financial   Accounting  Standards  Board  issued
Statement  of  Financial  Accounting  Standards  (SFAS) No. 128,  "Earnings  per
Share," which will be effective  during the fourth quarter of 1997. SFAS No. 128
will  require  the  Company in its fourth  quarter  and in its annual  report to
restate all previously  reported  earnings per share information to conform with
the new pronouncement's requirements.  The Company anticipates that earnings per
share calculated in conformity with SFAS No. 128 will not differ materially from
current  figures  because  the  issuance of common  shares upon the  exercise of
outstanding stock options would not be materially dilutive.

                                       7
<PAGE>

         Liquidity and Capital Resources (continued)

         The Financial  Accounting  Standards Board recently issued SFAS No. 130
on  "Reporting  Comprehensive  Income"  and SFAS No. 131 on  "Disclosures  about
Segments of an Enterprise and Related Information." The "Reporting Comprehensive
Income"  standard is effective  for fiscal years  beginning  after  December 15,
1997. The standard changes the reporting of certain items currently  reported in
the common stock equity section of the balance sheet and is not expected to have
a material effect on the Company's financial statements,  The "Disclosures about
Segments of an  Enterprise  and Related  Information"  standard is effective for
fiscal years  beginning  after  December 15, 1997.  This standard  requires that
public companies report certain  information  about operating  segments in their
financial statements. It also establishes related disclosures about products and
services,  geographical  areas,  and major  customers.  The Company is currently
evaluating what impact this standard will have on its disclosures.

2.   Results of Operations

         Net sales for the third  quarter  ended  September  30,  1997 were $5.6
million,  a  decrease  of 23.6% from last  year's  third  quarter  sales of $7.3
million.  On a year-to-date  basis, total sales are $13.3 million or 12.2% lower
than the net sales of $15.1 million  reported for the first nine months of 1996.
Sales  for the  third  quarter  of this  year do not  include  a major  customer
shipment that took place at the end of the third quarter in 1996.

         Gross margin as a percentage of net sales for the third quarter of 1997
was 27.5% compared to the prior year's level of 26.9%. On a year-to-date  basis,
the Company's gross margin is 28.0% compared to 25.4% in 1996. This increase has
been achieved by a shift in product mix to higher margin products.

         Selling,  general and  administrative  expenses in the third quarter of
1997 are below 1996 by $147,319 or 10%. This decrease reflects lower selling and
retail costs.  Retail selling expenses are down significantly due to the closing
of several retail outlets in 1996.

         Interest expense for the third quarter of 1997 has decreased by $38,718
as compared to the third quarter of last year.  Through  September,  the Company
has reduced its  interest  expense by $224,575 or 36% over 1996.  This  decrease
reflects a lower borrowing rate of interest and reduced spending levels.

         The Company  produced  net income  before taxes of $72,799 in the third
quarter of 1997, compared to $316,948 in 1996. On an after-tax basis, income for
the  quarter  was  $45,135 or $.03 per share as opposed to income of $196,508 or
$.13 per share in 1996.

         Through  the first nine months of 1997,  the  Company had an  after-tax
loss of $418,254 or $.28 per share. This compares to last year's  performance of
an after-tax loss of $517,633 or $.43 per share.

         As of  September  30,  1997,  the  Company was in  violation  of a bank
covenant  relating to operating  income as outlined in the loan  agreement  with
KeyBank National Association.  On October 23, 1997 the Company obtained a waiver
on this  financial  covenant.  In  consideration  of this  waiver,  the  Company
forfeited a $1,000,000 capital expenditure line,
previously provided by the Lender.

                                       8

<PAGE>



DANIEL GREEN COMPANY

Part II - Other Information

1. Legal Proceedings - None.

2. Changes in Securities - None.

3. Default upon Senior Securities - None.

4. Submission of matters to a vote of security holders - None.

5. Other Information - None.

6. Exhibits and reports on Form 8K - None.


                                       9

<PAGE>



     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.


                                       DANIEL GREEN COMPANY
                                            Registrant



Date: November 13, 1997            /s/ Stanley W. Kabot
                                   Stanley W. Kabot, Chief
                                   Financial Officer