Company Name: DANIEL GREEN COMPANY Ticker Symbol: DAGR


                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

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

          For the quarter ended June 30, 2001 Commission File No. 0-774

                              DANIEL GREEN COMPANY
                 (Name of Small Business Issuer in its Charter)

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

         OLD TOWN, MAINE                                            04468
(Address of principal executive offices)                         (Zip Code)

Issuer's telephone number, including area code: (207) 827-4431

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

Check whether the issuer:  (1) filed all reports required to be filed by section
13 or 15(d) of the  Exchange  Act  during  the past  twelve  months (or for such
shorter period that the  registrant was required to file such reports),  and (2)
has been subject to the filing requirements for the past 90 days. YES _X_ NO ___

         CLASS                              OUTSTANDING AT JUNE 30, 2001
Common Stock $2.50 par value                         1,889,027


Transitional Small Business Disclosure Format (Check One)  Yes __   No _X_


<PAGE>


                                       1

                              DANIEL GREEN COMPANY
                                      INDEX

                                                                           Page
                                                                          Number

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

PART I - Financial Information

Consolidated Balance Sheets, Assets
         June 30, 2001 and December 31, 2000 ..............................    2

Consolidated Balance Sheets, Liabilities & Stockholders' Equity
         June 30, 2001 and December 31, 2000 ..............................    3

Consolidated Statements of Operations for the three months and
         six months ended June 30, 2001 and 2000 ..........................    4

Consolidated Statements of Cash Flows for the six months ended
         June 30, 2001 and 2000 ...........................................    5

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

Management Discussion & Analysis of Financial Condition and Results
         of Operations ....................................................    9

PART II - Other Information ...............................................   11




<PAGE>

                                       2


                              DANIEL GREEN COMPANY
                           Consolidated Balance Sheets

                                     ASSETS

                                                   June 30,         December 31,
                                                     2001              2000
                                                  (Unaudited)          (*)
                                                  -----------       -----------
Current Assets:
Cash                                              $   123,849       $     1,395
Accounts Receivable, trade
less allowances of $1,305,000 in 2001
         and $2,249,000 in 1999                     6,868,051        14,601,499

Deferred Income Tax Asset                             654,491           654,491

Finished Goods Inventories, at lower of
      cost (FIFO) or market:                       16,693,038        14,758,949

Other Current Assets                                  745,975           193,757
                                                  -----------       -----------
 Total Current Assets                              25,085,404        30,210,091

Property, plant & equipment:
Real Estate and Water Power, at cost                1,698,581         1,698,581
Machinery & Equipment at cost                         734,330           734,330
                                                  -----------       -----------
                                                    2,432,911         2,432,911
Less: Accumulated Depreciation                        479,306           378,333
                                                  -----------       -----------
Property, plant & equipment, net                    1,953,605         2,054,578

Other Assets:
Deferred Income Tax Asset                                   0           795,038
Prepaid Pension Cost                                        0         3,610,518
Other Assets, net                                   2,952,847         1,754,176
                                                  -----------       -----------
 Total Other Assets                                 2,952,847         6,159,732
                                                  -----------       -----------
 Total Assets                                     $29,991,856       $38,424,401
                                                  ===========       ===========



(*)  Derived from audited consolidated financial statements.

See notes to consolidated financial statements.



<PAGE>

                                       3


                              DANIEL GREEN COMPANY
                           Consolidated Balance Sheets

                       LIABILITIES & STOCKHOLDERS' EQUITY


                                                 June 30,           December 31,
                                                  2001                 2000
                                                (Unaudited)             (*)
                                               ------------        ------------
Current Liabilities:

Notes Payable, line of credit                  $  9,577,181        $ 12,500,000
Notes Payable, current                            7,715,425           6,416,743
Accounts Payable, trade                           3,045,935           9,158,314
Liability to former stockholder                   1,805,951           1,805,951
Income Tax Payable                                   54,197             898,364
Other Accrued Liabilities                           431,196           1,038,078
                                               ------------        ------------

Total Current Liabilities                        22,629,885          31,817,450

Deferred Income Taxes                               613,064                   0
Notes Payable, non-current                        1,047,619               9,320
Other Liability                                     700,000             700,000
                                               ------------        ------------
Total Other Liabilities                           2,360,683             709,320
Total Liabilities                                24,990,568          32,526,770

Stockholders' Equity:

Common Stock                                      5,071,065           4,245,823
Paid-in-excess of par value                       1,837,887             815,940
Retained Earnings                                   302,838           1,305,759
                                               ------------        ------------
                                                  7,211,790           6,367,522
Less: Treasury Stock                             (2,210,502)           (469,891)
                                               ------------        ------------
Total Stockholders' Equity                        5,001,288           5,897,631
                                               ------------        ------------
 Total Liabilities & Stockholders'
         Equity                                $ 29,991,856        $ 38,424,101
                                               ============        ============



(*)  Derived from audited consolidated financial statements.

See notes to consolidated financial statements.

<PAGE>

                                        4


                              DANIEL GREEN COMPANY
                      Consolidated Statements of Operations
                                   (Unaudited)


<TABLE>
<CAPTION>
                                                            Three Months Ended                           Six Months Ended
                                                      June 30,              June 30,              June 30,              June 30,
                                                        2001                  2000                  2001                  2000
                                                   --------------------------------------------------------------------------------
<S>                                                <C>                    <C>                   <C>                    <C>
Net Sales                                          $  8,399,823           $ 6,398,449           $ 19,317,315           $  7,554,006

Costs and Expenses
  Cost of Goods Sold                                  5,364,824             4,245,004             12,305,596              5,551,661
  Selling, General &
    Administrative                                    2,504,759             2,469,592              5,609,119              4,715,740
Other Expense-Pension                                 1,713,710                     0              1,713,710                      0
 Interest Expense                                       517,963               437,282              1,009,734                 69,282
                                                   --------------------------------------------------------------------------------
Total Costs and Expenses                             10,101,256             7,151,878             20,638,159             10,336,683

 Loss before Income
    Tax Expense                                      (1,701,433)             (753,429)            (1,320,844)            (2,782,677)

Income Tax  Credit                                     (474,158)             (263,886)              (317,923)              (750,906)
                                                   --------------------------------------------------------------------------------
Net Loss                                           $ (1,227,275)          $  (489,543)          $ (1,002,921)          $ (2,031,771)
                                                   ================================================================================

Net Loss per Share:
  Basic                                            $      (0.78)          $     (0.31)          $      (0.64)          $      (1.30)
  Diluted                                          $      (0.78)          $     (0.31)          $      (0.64)          $      (1.30)

Shares Outstanding:
  Basic                                               1,572,486             1,560,789              1,570,549              1,560,789
  Diluted                                             1,572,486             1,560,789              1,570,549              1,560,789
</TABLE>



See notes to consolidated financial statements.


<PAGE>

                                        5


                              DANIEL GREEN COMPANY
                Consolidated Statements of Cash Flows (Unaudited)

<TABLE>
<CAPTION>
                                                         For the Six Months Ended
                                                       June 30,           June 30,
                                                         2001               2000
                                                      -----------       ------------
<S>                                                   <C>               <C>
Operating Activities:
Net Loss                                              $(1,002,921)      $ (2,031,771)
Adjustments to reconcile net income (loss)
  to net provided by operating activities:
     Depreciation and amortization                        408,638            122,758
Changes in assets & liabilities:
  (Increases) decreases in:
    Accounts Receivable, trade                          7,733,448          3,373,461
     Finished Goods Inventories                        (1,934,089)          (729,313)
    Other Current Assets                                 (552,218)           (41,757)
    Other Assets                                                0           (434,515)
 Increases (decreases) in:
    Accounts Payable, trade                            (6,112,379)          (198,237)
    Accrued Salaries & Commissions                              0            (34,702)
    Other Accrued Liabilities                            (557,927)           264,664
    Income Taxes Payable                                 (844,167)                 0
    Prepaid Pension                                     3,610,518                  0
                                                      -----------       ------------
Net cash provided by Operating Activities                 748,903            290,588
 Investing Activities:
  Acquisition of business less cash acquired                    0        (11,485,900)
  Sale of Marketable Securities                                 0            718,000
  Purchase of property & equipment                              0           (204,199)
                                                      -----------       ------------
Net cash used in Investing Activities                           0        (10,972,099)
 Financing Activities:
  Net Borrowing/(Payment) on Line of Credit            (2,922,819)         5,716,152
  Net Borrowing of Notes Payable                        2,336,981          5,242,378
  Purchase of Treasury Stock                              (40,611)           (25,183)
  Other Refinancing Expenses                                    0            (52,727)
                                                      -----------       ------------
Net Cash Provided/(Used) in Financing Activities         (626,449)        10,880,620
                                                      -----------       ------------
Net Increase in Cash                                      122,454            199,109

Cash at Beginning of Period                                 1,395            225,079
                                                      -----------       ------------
Cash at End of Period                                 $   123,849       $    424,188
                                                      ===========       ============
</TABLE>


<PAGE>


                                        6

                              DANIEL GREEN COMPANY
                   Notes to Consolidated Financial Statements

Note 1.

     In the opinion of the  Company,  the  accompanying  unaudited  consolidated
financial  statements  contain  adjustments,  all of which  are of a normal  and
recurring nature,  necessary to present fairly the financial position as of June
30,  2001 and the  results  of  operations  and cash flows for the three and six
months then ended.  The results of operations  for the six months ended June 30,
2001 are not  necessarily  indicative of the results to be expected for the full
year.

Note 2.

     The accounting  policies used in preparing these statements are the same as
those used in preparing the Company's  consolidated financial statements for the
year ended December 31, 2000. These condensed  consolidated financial statements
should be read in conjunction  with the  consolidated  financial  statements and
notes thereto  included in the Company's  annual report to stockholders  for the
year ended December 31, 2000.

Note 3.

     Due to severe global competition, the Company ceased domestic manufacturing
and  transitioned  to a fully  sourced  importer  during 1999. At the same time,
several acquisition  opportunities were aggressively evaluated and pursued. This
activity  resulted in acquiring  certain assets of one of the Company's  largest
competitors,  L. B.  Evans and Son  Company  Limited  Partnership  ("Evans")  on
February 3, 2000.  In addition,  the Company  purchased  all of the  outstanding
shares of Penobscot Shoe Company ("Penobscot") from Riedman Corporation on March
30, 2000.  Penobscot Shoe Company has been making  women's  footwear for over 60
years  and is  based in Old  Town,  Maine.  Since a  significantly  more  modern
distribution facility, with excess capacity came with the Penobscot acquisition,
it was decided that relocating the Daniel Green operation to Maine would provide
the most efficient and effective  platform for optimizing the synergies from the
three businesses. During May 2000, and pursuant to a public announcement made by
the Company on March 30,  2000,  the  Company's  headquarters  and  distribution
operation  previously  located in  Dolgeville,  New York were  relocated to, and
consolidated with, the newly acquired operations in Old Town, Maine.

     The  acquisition  of Penobscot  has been  accounted  for under the purchase
method of accounting and,  accordingly,  the operation results of Penobscot have
been included in the Company's  consolidated financial statements since the date
of acquisition.


<PAGE>


                                        7


The  following  summary  presents  unaudited  proforma  consolidated  results of
operations  as if the  acquisition  had occurred at the  beginning of 2000,  and
include adjustments for estimated amounts of goodwill amortization, depreciation
of fixed  assets  acquired  based  on their  estimated  fair  values,  increased
interest expense assuming the purchase  consideration had resulted in additional
borrowing  during  the  periods  presented.   The  pro  forma  results  are  for
illustrative  purposes  only,  and do not purport to be indicative of the actual
results which would have occurred had the transaction been consummated as of the
earlier dates,  nor are they indicative of results of operations which may occur
in the future. The results do not reflect synergies.

         Six Months Ended June 30,                              2000
         -------------------------------------------------------------

         In thousands, except per share amounts (unaudited)
         Net Sales                                           $ 14,068
         Net Earnings (Loss)                                   (1,244)
         Net Earnings (Loss) per Common Share                   (0.80)

Note 4

     Effective  January 1, 2001, the Company adopted the provisions of Statement
of Financial  Accounting  Standards  (SFAS) No. 133,  "Accounting for Derivative
Instruments and Hedging Activities" as amended by SFAS No. 138,  "Accounting for
Derivative  Instruments and Certain Hedging Activities." These standards require
the Company to recognize all derivatives as either assets or liabilities at fair
value in its  balance  sheet.  The  accounting  changes  in the fair  value of a
derivative depends on the use of the derivative. To the extent that a derivative
is effective as a hedge of a future exposure to changes in value, the fair value
of the  derivative  is  deferred  in other  comprehensive  income.  Any  portion
considered  to be  ineffective  is  reported  in  the  statement  of  operations
immediately.

     The  adoption  of these  standards  did not have a  material  impact on the
Company's  financial  statements and therefore,  a transition  adjustment is not
separately presented.

     The Financial  Accounting  Standards  Board issued SFAS No. 141,  "Business
Combinations",  and SFAS No. 142, "Goodwill and Other Intangible Assets".  These
statements make significant changes to the accounting for business combinations,
goodwill and intangible assets. SFAS No. 141 eliminates the pooling-of-interests
method of  accounting  for business  combinations  with limited  exceptions  for
combinations  initiated prior to July 1, 2001. In addition, it further clarifies
the criteria for recognition of intangible assets separately from goodwill. This
statement is effective for business combinations completed after June 30, 2001.


<PAGE>


                                        8


SFAS  No.  142   discontinues   the   practice  of   amortizing   goodwill   and
indefinite-lived   intangible   assets  and   initiates  an  annual  review  for
impairment.  Impairment would be examined more frequently if certain  indicators
are encountered. Intangible assets with a determinable useful life will continue
to be amortized  over their useful  lives.  SFAS No. 142 applies to goodwill and
intangible  assets acquired after June 30, 2001.  Goodwill and intangible assets
existing  prior to July 1, 2001 will be  affected  when the  Company  adopts the
statement.  SFAS No. 142 is effective for fiscal years  beginning after December
15,  2001.  The  Company  is  evaluating  the  impact of the  adoption  of these
standards  and has not yet  determined  the effect of adoption on its  financial
position and results of operations.

Note 5.

     During  the  quarter  ended  June  30,  2001,  the  Company  completed  the
termination of its defined benefit pension plan. On the date of the termination,
the Company received cash totaling $2,377,600,  which was less than the carrying
value of the prepaid  pension cost asset of  $3,734,670,  resulting in a loss of
$1,357,070.  This loss was increased by an excise tax totaling  $356,640,  which
resulted in a total loss on this transaction totaling $1,713,710. This amount is
included in other expense in the 2001 statement of operations.

     During the second quarter ended June 30, 2001, following the termination of
its defined benefit pension plan, the Company  contributed cash of $1,700,000 to
the Company's 401(k) savings plan ("the Plan").  Subsequently,  in June 2001 the
Plan acquired  330,097 shares of the Company's common stock at a price per share
of $5.15, which was based on an independent  appraisal.  There were no allocated
shares  as of June 30,  2001.  The  unallocated  shares  in the Plan  have  been
classified as treasury stock in stockholders  equity.  Compensation expense will
be recognized as the shares are allocated to the participants, which is expected
to occur over a seven-year period.


<PAGE>


                                       9


                              DANIEL GREEN COMPANY
           Management Discussion & Analysis of Financial Condition and
                              Results of Operations

1.   Liquidity and Capital Resources

     At June 30, 2001 the Daniel Green Company had working capital of $2,455,519
vs. a working capital deficiency of ($1,607,359) at December 31, 2000.

     The consolidated  statement of cash flows for the six months ended June 30,
2001 shows an increase of cash of  approximately  $123,000  since  December  31,
2000.  Net cash provided  from  operations  was  $748,903,  primarily due to the
reduction in accounts  receivable from December 31, 2000.  During the six months
ended June 30, 2001 accounts payable trade was reduced by $6,112,379.

     At  the  end  of  the  second  quarter  of  2001,  total  indebtedness  was
$20,146,176  which consisted of: line of credit balance,  current of $9,577,181,
notes payable,  current,  of $7,715,425  (which includes $750,000 due to a major
stockholder),  notes payable, noncurrent, of $1,047,619, and a liability related
to the dissenting shareholders of Penobscot of $1,805,951.

     The Company has a revolving line of credit ("revolver"), an additional term
loan facility in the amount of $6,000,000,  a supplemental  loan facility in the
amount of $2,800,000,  and an additional bridge loan (amendment to the revolver)
of $2,000,000.  The borrowing base for the revolver is based on certain balances
of accounts receivable and inventory,  as defined in the agreement.  The maximum
credit amount under the revolver is $12,500,000, the interest rate is prime plus
 .75% (the prime rate was 6.75% at June 30) and the revolver  expires on April 1,
2003. The revolver is secured by accounts receivable,  inventory, and equipment.
The term loan is payable  through  April 1, 2003 and is also secured by accounts
receivable,   inventory,  and  equipment.  The  supplemental  loan  facility  is
available  through April 1, 2003. The bridge loan has an expiration  date of May
30, 2002. A major  stockholder of the Company  guarantees these  facilities.  In
addition,  the Company has a loan in the amount of $750,000  outstanding  to the
same major stockholder.

     The revolver and the term loan  agreements  contain  covenants  relative to
average  borrowed funds to earnings ratio,  net income,  current ratio, and cash
flow  coverage.  In  addition,  the  payment or  declaration  of  dividends  and
distributions  is  prohibited  unless a written  consent form from the lender is
received. On May 31, 2001, the bridge loan was executed,  and upon the effective
date of this amendment to the revolver, the Bank waived the Company's failure to
comply with certain covenants, subject to complying with newly stated covenants.

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


<PAGE>

                                       10


2.   Results of Operations

     Net Sales for the second quarter of 2001 were $8.4 million compared to $6.4
million for the same period in the prior year.  This year's results  represent a
31.2%  increase  over the  results  for last  year.  The net sales  increase  is
primarily  attributable to the Trotters and Softwalk brands,  which were part of
the Penobscot Shoe Company acquisition which took place in 2000.

     The gross margin in the current quarter was approximately 36.1% compared to
33.7% in the same quarter  last year.  The increase in gross profit is primarily
due to the positive performance in the Trotters and Softwalk brands.

     Selling,  general and administrative  expenses as a percentage of net sales
were 29.8% or $2.5  million for the second  quarter of 2001 as compared to 38.6%
or $2.5  million  for the same  quarter in 2000.  The  results  in 2000  include
amounts associated with closing and securing the Company's  Dolgeville  location
and terminated employees' severance packages.

     Included  in other  expenses  for the  second  quarter  of 2001  are  costs
associated with the termination of the Penobscot Shoe Company  Retirement  plan,
totaling  $1,713,710.  During the  quarter  ended  June 30,  2001,  the  Company
completed the  termination of its defined  benefit  pension plan. On the date of
the termination,  the Company received cash totaling $2,377,600,  which was less
than the  carrying  value  of the  prepaid  pension  cost  asset of  $3,734,670,
resulting  in a loss of  $1,357,070.  This loss was  increased  by an excise tax
totaling $356,640,  which resulted in a total loss on this transaction  totaling
$1,713,710.

     During the second quarter of 2001, interest expense amounted to $517,963 as
compared  to $437,282 in the second  quarter of 2000.  For the six months  ended
June 30, 2001 interest  expense  amounted to $1,009,734  compared to $69,282 for
the same  period  last year.  The reason for the  increase  is the  increase  in
outstanding debt vs. last year.

     A majority of our products  continue to be made of leather.  As a result of
the Mad Cow disease epidemics in Europe,  the footwear industry  continues to be
concerned  about  rising  leather  prices in the future and what impact on gross
profits this could have. Year to date we have begun to experience  limited price
increases for our cost of goods sold.

     During  what has been  described  as a "very  tough"  Spring  season by the
industry, both the Trotters and Softwalk brands of the Company have continued to
perform  well at  retail.  This is a result of our  brands  maintaining  a clean
channel  of   distribution   with  a  focus  on  growing   the   business   with
non-promotional retailers. Our order backlog position is currently running ahead
of last year's results.


<PAGE>

                                       11


                           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  - The  annual  meeting  of the  stockholders  has  been
     scheduled  for  Thursday,  September 6, 2001 at 10:00 am at the  Strathalan
     Hotel, 550 East Avenue,  Rochester, New York, 14607. Stockholders of record
     on June 24, 2001 will receive notice of the meeting.

6.   Exhibits and Reports on Form 8K - Exhibit index  appearing  after signature
     page is hereby incorporated by reference.

     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.



<PAGE>


                              DANIEL GREEN COMPANY
                                   Registrant


Date:
      ------------------                              -------------------------
                                                      Robert M. Weedon
                                                      Chief Financial Officer



                                                      /s/ James R. Riedman
                                                      --------------------------
                                                          James R. Reidman
                                                          Chief Executive Office