SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                   Form 10-QSB

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

         For the quarter ended March 31, 1999 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)

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

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

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 MARCH 31, 1999

Common Stock $2.50 par value                         1,566,779


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                                                                          Page 1

                              DANIEL GREEN COMPANY

                                      INDEX
                                                                         Page
                                                                        Number

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

PART I - Financial Information

Balance Sheets, Assets
      March 31, 1999 & December 31, 1998. . . . . . . . . . . . . . . . . 2

Balance Sheets, Liabilities & Stockholders' Equity 
      March 31, 1999 & December 31, 1998. . . . . . . . . . . . . . . . . 3

Statements of Operations for the three months ended
      March 31, 1999 and March 31, 1998 . . . . . . . . . . . . . . . . . 4

Statements of Cash Flows for the three months ended
      March 31, 1999 and March 31, 1998 . . . . . . . . . . . . . . . . . 5

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

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

PART II - Other Information   . . . . . . . . .. . . . . . . . . . . . . 10


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                                                                          Page 2

                              DANIEL GREEN COMPANY
                                 Balance Sheets

                                     ASSETS
                                                    March 31     December 31
                                                      1999          1998
                                                   (Unaudited)      (*)
                                                  ------------  ------------   
Current Assets:
Cash                                              $     5,400   $     7,300

Accounts Receivable, trade
 less allowances for doubtful accounts
 (1999 - $175,760  1998 - $250,000)                 2,973,860     4,205,979

Deferred Income Tax Asset                             164,124       164,124

Income Tax Receivable
                                                      387,142       387,142

Inventories, at lower of cost (FIFO) or market:
         Raw Materials                              1,072,827       995,918
         Work In Process                              132,489        82,795
         Finished Goods                             3,805,845     4,402,186
                                                  -----------   -----------
           Total Inventories                        5,011,161     5,480,899

Other Current Assets                                    1,797        50,275
                                                  -----------   -----------

Total Current Assets                                8,543,484    10,295,719

Property, plant & equipment:
Real Estate and Water Power, at cost                2,560,504     2,560,504
Machinery, Equipment, & Lasts, at cost              1,557,129     1,526,742
                                                  -----------   -----------
                                                    4,117,633     4,087,246
Less: Accumulated Depreciation                      3,254,974     3,180,179
                                                  -----------   -----------
Property, plant & equipment, net                      862,659       907,067


Other Assets:
Deferred income tax asset                             389,565       267,905
Other Assets                                          104,722        69,399
                                                  -----------   -----------
 Total Other Assets                                   494,287       337,304
                                                  -----------   -----------


Total Assets                                      $ 9,900,430   $11,540,090
                                                  ===========   ===========

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                                                                          Page 3

                              DANIEL GREEN COMPANY

                                 Balance Sheets

                       Liabilities & Stockholders' Equity

                                             March 31      December 31
                                               1999           1998
                                            (Unaudited)        (*)   
                                           ------------    ------------

Current Liabilities:

Notes Payable, line of credit              $    282,166    $  1,144,092
Notes Payable, current                        1,084,256       1,212,424
Accounts Payable, trade                         551,524         833,177
Accrued Salaries & Commissions                  107,410          21,242
Other Accrued Liabilities                       290,778         301,802
                                           ------------    ------------



Total Current Liabilities                     2,316,134       3,512,737

Notes Payable, non-current                      107,290         116,361
                                           ------------    ------------

Total Liabilities                             2,423,424       3,629,098


Stockholders' Equity

Common Stock                                  4,245,823       4,245,823
Paid-in-excess of par value                     741,303         741,303
Retained Earnings                             3,120,321       3,516,189
                                              8,107,447       8,503,315
Less: Treasury Stock                           (630,441)       (592,323)
                                           ------------    ------------

Total stockholders' equity                    7,477,006       7,910,992
                                           ------------    ------------

Total Liabilities & Stockholders' Equity   $  9,900,430    $ 11,540,090
                                           ============    ============


(*) Derived from audited financial statements.

See notes to financial statements.
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                                                                          Page 4

                              DANIEL GREEN COMPANY

                            Statements of Operations
                                   (Unaudited)

                                             For the Three Months Ended
                                            March 31            March 31
                                              1999                1998   
                                          -----------          -----------


Net Sales                                 $ 2,887,025          $ 2,499,463 
                                                              
Costs and Expenses:                                           
                                                              
 Cost of Goods Sold                         2,423,254            2,477,502
 Selling, General, & Administrative           960,064            1,101,244
 Interest Expense                              21,233               53,635
                                          -----------          -----------
                                                              
Total Costs and Expenses                    3,404,551            3,632,381
                                          -----------          -----------
                                                              
Loss before credit for Income Taxes          (517,526)          (1,132,918)
                                                              
Credit for Income Taxes                       121,660              430,509
                                          -----------          -----------
                                                              
Net Loss                                  ($  395,866)         ($  702,409)
                                          ===========          ===========
                                                              
Net Loss per Share:                                           
     Basic                                     ($0.25)              ($0.46)
     Diluted                                   ($0.25)              ($0.46)
Weighted Average Shares Outstanding:                          
     Basic                                  1,570,925            1,511,892
     Diluted                                1,570,925            1,511,892
                                                          






See notes to financial statements.

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                                                                          Page 5

                              DANIEL GREEN COMPANY
                            Statements of Cash Flows
                                   (Unaudited)

                                               For the Three Months Ended
                                                March 31        March 31
                                                  1999            1998   
                                              ------------   ------------
Operating Activities:
 Net Loss                                     $  (395,866)   $  (702,409)
 Adjustments to reconcile net loss to net
 cash provided by operating activities:
  Depreciation                                     74,795         80,103
  Amortization                                      9,771          9,771
  Net Pension Expense                                   0         75,000
Changes in assets & liabilities:
 (Increases) decreases in:
  Accounts Receivable, trade                    1,232,119      2,311,132
  Income Tax Refund Receivable                          0       (430,897)
  Inventories                                     469,738        157,660
  Other Current Assets                             48,478          9,672
  Other Assets                                   (166,754)       (17,705)
 Increases (decreases) in:
  Accounts Payable, trade                        (281,653)       183,954
  Accrued Salaries                                 86,168         12,716
  Accrued Cooperative Advertising                 (50,160)      (123,203)
  Income Taxes Payable                                  0       (421,389)
  Other Accrued Liabilities                        39,135        (98,726)
                                              -----------    -----------
Net Cash Provided by Operating Activities       1,065,771      1,045,679

Investing Activities:
 Proceeds from disposals of property/equip              0            800
 Purchase of property & equipment                 (30,387)       (39,938)
                                              -----------    -----------
Net Cash Used in Investing Activities             (30,387)       (39,138)

Financing Activities:
 Net Payments on Line of Credit                  (861,926)    (1,760,195)
Repayments of Notes Payable                      (137,240)      (140,238)
 Purchase of Treasury Stock                       (38,118)             0
 Principal Payment Capital Lease                        0         (1,588)
                                              -----------    -----------
Net Cash Used in Financing Activities          (1,037,284)    (1,902,021)
                                              -----------    -----------

Net(Decrease)in Cash                               (1,900)      (895,480)

Cash at Beginning of Period                         7,300        901,875
                                              -----------    -----------

Cash at End of Period                         $     5,400    $     6,395
                                              ===========    ===========

See notes to financial statements.

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                                                                          Page 6

                              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 March 31, 1999 and the results of operations  and cash flows for
        the three months then ended.  

Note 2. The results of  operations  for the three  months ended March 31, 1999
        are not  necessarily  indicative of the results to be expected for the
        full year.                   

Note 3. Basic and diluted net loss per share for the three  months ended March
        31,  1998 have been  restated  as the  Company  did not  consider  the
        Company's unallocated shares in its 401(k) Plan as treasury stock when
        computing the originally reported amounts.                            
        


                                                 Basic             Diluted
        Net loss per share, as reported         ($0.41)            ($0.41)
        Effect of restatement                   ($0.05)            ($0.05)
        Net loss per share, as restated         ($0.46)            ($0.46)


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                                                                          Page 7

                              DANIEL GREEN COMPANY

             Management Discussion & Analysis of Financial Condition
                            and Results of Operations

1.       Liquidity and Capital Resources

         For the quarter  ended March 31,  1999,  net cash flows from  operating
activities  were  $1,065,771 as compared to $1,045,679  for the first quarter in
1998.

          The  Company  experienced  a lower  first  quarter  loss  than in 1998
($395,866  versus  $702,409).  Involvement  of a re-aligned  sales force in more
effective customer account control and collection, combined with more aggressive
payment terms,  reduced accounts  receivable enabling the Company to improve its
cash from operations. Significant reductions in manufacturing activities, due to
the implementation of the scheduled  restructuring plan,  referenced in the 1998
Annual Report,  resulted in an inventory reduction of $469,738 from December 31,
1998 levels.  Inventories in the first quarter of 1999 were $5,011,161  compared
to $8,311,715 at the end of March 31, 1998.

         Accounts receivable  decreased at the end of the first quarter of 1999,
to $2,973,860  from  $3,410,299 at the end of the same quarter of 1998,  and has
gone down by $1,232,119 since the beginning of the fiscal year.

         Prudent debt  management  for the first  quarter of 1999  resulted in a
borrowing  balance  on the  revolving  line of credit of  $282,166  compared  to
$459,607 at March 31,  1998.  The Company was able to achieve a lower  borrowing
balance in the first  quarter of 1999  solely with cash  provided  by  operating
activities.

         Through the first quarter of 1999, the Company had a credit arrangement
with KeyBank National  Association which provided the Company with an $8,000,000
revolving  line of credit and a $2,100,000  mortgage/term  loan. The revolver is
secured by accounts receivable,  inventory,  equipment and cash. As of March 31,
1999  the  Company  was  not in  compliance  with  certain  financial  covenants
contained in those loan  agreements.  Management is currently  negotiating  with
several financial institutions to facilitate new credit arrangements. During the
interim  period  Keybank  National  Association  has  extended  to the Company a
forbearance agreement until new financing arrangements are secured.

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                                                                          Page 8

         The  mortgage  term  loan is  secured  by the  Company's  manufacturing
facilities and totaled $1,047,621 as of March 31, 1999.

         Management  is not aware of any known  demands,  commitments  or events
which would materially affect its liquidity.  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.

2.       Results of Operations

     Although  shipments  of footwear  products  increased by 13,300 pairs or 7%
over the comparable period for 1998, net sales increased  $387,562 or 16% due to
higher average selling prices.

         Cost of  goods  sold  for the  first  quarter  was 84% of net  sales as
compared to 99% in 1998. Due to inventory  on-hand at the end of 1998,  together
with the  implementation  of planned  restructuring of the Company,  there was a
significant reduction in footwear production.  However,  production and overhead
expenses  were not  proportionately  reduced to the lower  level of  production.
Accelerating  the 1999  workforce  reduction  program  resulted  in  recognizing
($58,000) of unbudgeted  severance cost in the 1999 first quarter.  Purchases of
imported  product  increased  $285,000 or 120% over year to date  purchases  for
March 1998.  Selling,  general and administrative  (SG&A) expenses for the first
quarter of 1999, are below 1998 by $141,180 or 12.8%.  As a percentage of sales,
SG&A expenses for the first quarter of 1999 are down considerably over last year
by 11%. These  reductions were achieved by a concentrated  effort by all Company
employees to recognize  unnecessary or wasteful  spending.  Effective January 1,
1999 the Company approved two new policies: Expenditure Authorization Policy and
Procedure;  and Travel,  Entertainment,  and Other  Business  Expense Policy and
Procedure,  in a further  effort to control  costs and  expenses.  A significant
savings was realized in re-establishing a commission-based compensation plan for
our  field  sales  force.  Thereby,   eliminating  the  100%-reimbursed   travel
expense/salaried program initiated in 1998.

         Interest expense for the first quarter of 1999 has decreased by $32,402
or 60% compared to the first  quarter of 1998.  This  significant  decrease is a
result of lower debt levels.

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                                                                          Page 9

         The Company incurred a net loss before taxes of ($517,526) in the first
quarter of 1999,  compared to a pre-tax loss of  ($1,132,918)  last year.  On an
after-tax basis, the loss for the quarter was ($395,866) or ($0.25) per share as
opposed to a ($702,409) after-tax loss of ($0.46) per share in the first quarter
of 1998.


3. Year 2000

         The Company uses software and related computerized  information systems
that will be affected by the date change in the year 2000. The Company  believes
it does not have any significant non-information technology systems that will be
affected by the change in the year 2000.  Based on its  assessment,  the Company
has  determined  that it will replace or upgrade major  portions of its computer
hardware  and  software  so that its  computer  systems  will  properly  use and
recognize dates beyond December 31, 1999. Based on the most current  information
compiled by the Company,  the Company  believes that the costs of addressing the
year 2000 issue will be considerably  less than the $850,000  estimate stated in
the  1998  Annual  Report.  The  Company  expects  to  complete  all  year  2000
programming changes prior to the fourth quarter of 1999. The estimated costs of,
and time frame  related to, this project are based on estimates of the Company's
management,  and there can be no  assurance  that  actual  costs will not differ
materially from the current expectations.  While the Company plans to devote the
necessary  resources  to resolve  all  significant  year 2000 issues in a timely
manner,  which includes  developing a contingency  plan by the end of the second
quarter of 1999, if such processing  issues are not resolved in a timely manner,
the year 2000 issue could have a material impact on the operations and financial
condition of the Company.

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                                                                         Page 10

                              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.



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: May 12, 1999                          /s/ John E. Brigham
                                            John E. Brigham
                                            Chief Financial Officer,
                                            Treasurer



                                            /s/ Greg A. Tunney
                                            Greg A. Tunney
                                            President & COO