|                                                                                                                                                                                                                                                                                                                                                                                | QUARTERLY      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF      1934  |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
|        x                                                                                                                                                                                                                                                                                                                                                                       | For      the quarterly period ended                                                                | March      28, 2009 |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
| OR                                                                                                                                                                                                                                                                                                                                                                                  |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
|                                                                                                                                                                                                                                                                                                                                                                                | TRANSITION      REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF      1934 |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
|        o                                                                                                                                                                                                                                                                                                                                                                       | For      the transition period from                                                                |   | to |   |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
|                                                                                                                                                                                                                                                                                                                                                                                | Commission      file number                                                                        | 1-367 |
|                                                                                                                                                                                                                                                                                                                                                                                |
| THE      L. S. STARRETT COMPANY                                                                                                                                                                                                                                                                                                                                                     |
| (Exact      name of registrant as specified in its charter)                                                                                                                                                                                                                                                                                                                         |
|                                                                                                                                                                                                                                                                                                                                                                                |
| MASSACHUSETTS                                                                                                                                                                                                                                                                                                                                                                       |                                                                                               | 04-1866480 |
| (State      or other jurisdiction of incorporation or organization)                                                                                                                                                                                                                                                                                                                 |                                                                                               | (I.R.S.      Employer Identification No.) |
|                                                                                                                                                                                                                                                                                                                                                                                |
| 121      CRESCENT STREET, ATHOL, MASSACHUSETTS                                                                                                                                                                                                                                                                                                                                      | 01331-1915                                                                                         |
| (Address      of principal executive offices)                                                                                                                                                                                                                                                                                                                                       | (Zip      Code)                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Registrant's      telephone number, including area code                                                                                                                                                                                                                                                                                                                             | 978-249-3551                                                                                       |
|                                                                                                                                                                                                                                                                                                                                                                                |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Former      name, address and fiscal year, if changed since last  report                                                                                                                                                                                                                                                                                                            |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Indicate      by check mark whether the registrant: (1) has filed all reports required      to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934      during the preceding 12 months (or for such shorter period that the      registrant was required to file such reports), and (2) has been subject to      such filing requirements for the past 90 days.  |
|                                                                                                                                                                                                                                                                                                                                                                                |
| YES      x    NO o                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Indicate      by check mark whether the registrant is a large accelerated filer, an      accelerated filer, a non-accelerated filer, or a smaller reporting      company.  See definition of “accelerated filer,” “large      accelerated filer” and “smaller reporting company” in Rule 12b-2 of the      Exchange Act, (Check One): |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Large      Accelerated Filer o    Accelerated Filer x    Non-Accelerated      Filer o    Smaller Reporting Company o                                                                                                                                                                                                    |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Indicate      by check mark whether the registrant is a shell company (as defined in      Rule 12b-2 of the Exchange Act).                                                                                                                                                                                                                                                          |
|                                                                                                                                                                                                                                                                                                                                                                                |
| YES      o    NO x                                                                                                                                                                                                                                                                                                                                              |
|                                                                                                                                                                                                                                                                                                                                                                                |
| Common      Shares outstanding as of                                                                                                                                                                                                                                                                                                                                                | April      30, 2009                                                                                |   |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
| Class      A Common Shares                                                                                                                                                                                                                                                                                                                                                          | 5,765,293                                                                                          |   |
|                                                                                                                                                                                                                                                                                                                                                                                |                                                                                               |
| Class      B Common Shares                                                                                                                                                                                                                                                                                                                                                          | 869,467                                                                                            |   |

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|                                                                                                                                                                        |   | Page No. |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------|
|                                                                                                                                                                        |   |     |
| Part      I.                      Financial      Information: |   |     |
|                                                                                                                                                                        |   |     |
| Item      1.                      Financial      Statements   |   |     |
|                                                                                                                                                                        |   |     |
| Consolidated      Statements of Operations –thirteen      weeks and thirty-nine weeks ended March 28, 2009 and March 29, 2008      (unaudited)                        |   | 3        |
|                                                                                                                                                                        |   |     |
| Consolidated      Statements of Cash Flows –thirteen      and thirty-nine weeks ended March 28, 2009 and March 29, 2008      (unaudited)                              |   | 4        |
|                                                                                                                                                                        |   |     |
| Consolidated      Balance Sheets –March      28, 2009 (unaudited) and June 28, 2008                                                                                   |   | 5        |
|                                                                                                                                                                        |   |     |
| Consolidated      Statements of Stockholders' Equity -thirty-nine      weeks ended March 28, 2009 and March 29, 2008 (unaudited)                                            |   | 6        |
|                                                                                                                                                                        |   |     |
| Notes      to Consolidated Financial Statements                                                                                                                             |   | 7-12     |
|                                                                                                                                                                        |   |     |
| Item      2.     Management's Discussion and Analysis of      Financial Condition and Results of Operations                                        |   | 13-19    |
|                                                                                                                                                                        |   |     |
| Item      3.     Quantitative and Qualitative Disclosures      About Market Risk                                                                   |   | 19       |
|                                                                                                                                                                        |   |     |
| Item      4.     Controls and Procedures                                                                                                           |   | 19       |
|                                                                                                                                                                        |   |     |
| Part      II.  Other information:                                                                                                                                 |   |     |
|                                                                                                                                                                        |   |     |
| Item      1A.  Risk Factors                                                                                                                                       |   | 19-21    |
|                                                                                                                                                                        |   |     |
| Item      2.      Unregistered Sales of Equity      Securities and Use of Proceeds                                                            |   | 22       |
|                                                                                                                                                                        |   |     |
| Item      6.      Exhibits                                                                                                                    |   | 22       |
|                                                                                                                                                                        |   |     |
| SIGNATURES                                                                                                                                                                  |   | 22       |

----

|                                                                                |   | 13 Weeks Ended |    |   | 39 Weeks Ended |   |
|-------------------------------------------------------------------------------------|--------|----------------|---------|--------|----------------|--------|
|                                                                                |   | 3/28/09        |    |   | 3/29/08        |   |   | 3/28/09 |   |   | 3/29/08 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |
| Net      sales                                                                      |   | $              | 42,764  |   |           | $      | 60,101 |   |   | $ | 164,830 |   |   | $ | 182,087 |   |
| Cost      of goods sold                                                             |   |           | (31,628 | )      |           |   | (41,041 | ) |   |   | (116,186 | ) |   |   | (124,929 | ) |
| Selling      and general expense                                                    |   |           | (13,190 | )      |           |   | (15,237 | ) |   |   | (46,181 | ) |   |   | (45,706 | ) |
| Goodwill      impairment (Note 4)                                                   |   |           | (5,260  | )      |           |   | - |   |   |   | (5,260 | ) |   |   | - |   |
| Other      income (expense)                                                         |   |           | (201    | )      |           |   | 1,155 |   |   |   | 1,154 |   |   |   | 3,051 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| (Loss)      Earnings before income taxes                                            |   |           | (7,515  | )      |           |   | 4,978 |   |   |   | (1,643 | ) |   |   | 14,503 |   |
| Income      tax (benefit) expense                                                   |   |           | (2,765  | )      |           |   | 2,116 |   |   |   | (651 | ) |   |   | 5,888 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Net      (loss) earnings                                                            |   | $              | (4,750  | )      |           | $      | 2,862 |   |   | $ | (992 | ) |   | $ | 8,615 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Basic      and diluted earnings per share                                           |   | $              | (0.72   | )      |           | $      | 0.43 |   |   | $ | (0.15 | ) |   | $ | 1.30 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Average      outstanding shares used in per share calculations (in      thousands): |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                                               |   |           | 6,622   |   |           |   | 6,598 |   |   |   | 6,619 |   |   |   | 6,594 |   |
| Diluted                                                                             |   |           | 6,622   |   |           |   | 6,606 |   |   |   | 6,619 |   |   |   | 6,602 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Dividends      per share                                                            |   | $              | 0.12    |   |           | $      | 0.10 |   |   | $ | 0.36 |   |   | $ | 0.40 |   |
|                                                                                |   |           |    |   |           |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                     |   | 13 Weeks Ended |   |   | 39 Weeks Ended |   |
|----------------------------------------------------------|--------|----------------|--------|--------|----------------|--------|
|                                                     |   | 3/28/09        |   |   | 3/29/08        |   |   | 3/28/09 |   |   | 3/29/08 |   |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |
| Cash      flows from operating activities:               |   |           |   |   |           |   |   |   |   |   |   |   |
| Net (loss)earnings                                       |   | $              | (4,750 | )      |           | $      | 2,862 |   |   | $ | (992 | ) |   | $ | 8,615 |   |
| Non-cash items      included:                            |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Gain from sale of real      estate                       |   |           | -      |   |           |   | - |   |   |   | - |   |   |   | (1,703 | ) |
| Depreciation                                             |   |           | 2,063  |   |           |   | 2,460 |   |   |   | 6,569 |   |   |   | 7,299 |   |
| Impaired fixed    assets                                 |   |           | -      |   |           |   | - |   |   |   | - |   |   |   | 95 |   |
| Goodwillimpairment                                       |   |           | 5,260  |   |           |   | - |   |   |   | 5,260 |   |   |   | - |   |
| Amortization                                             |   |           | 312    |   |           |   | 312 |   |   |   | 936 |   |   |   | 928 |   |
| Net long-term tax      payable                           |   |           | 104    |   |           |   | - |   |   |   | 328 |   |   |   | - |   |
| Deferred taxes                                           |   |           | (3,092 | )      |           |   | 1,290 |   |   |   | (3,654 | ) |   |   | 2,397 |   |
| Unrealized transaction (gains)      losses               |   |           | 41     |   |           |   | (399 | ) |   |   | 1,336 |   |   |   | (955 | ) |
| Retirementbenefits                                       |   |           | (488   | )      |           |   | (775 | ) |   |   | (1,477 | ) |   |   | (2,518 | ) |
| Working capital      changes:                            |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Receivables                                              |   |           | 2,336  |   |           |   | 184 |   |   |   | 3,336 |   |   |   | (546 | ) |
| Inventories                                              |   |           | (923   | )      |           |   | (1,055 | ) |   |   | (12,032 | ) |   |   | 3,757 |   |
| Other current    assets                                  |   |           | (384   | )      |           |   | 238 |   |   |   | (1,145 | ) |   |   | 906 |   |
| Other current      liabilities                           |   |           | (2,120 | )      |           |   | (1,415 | ) |   |   | (5,295 | ) |   |   | (684 | ) |
| Prepaid pension cost and      other                      |   |           | 131    |   |           |   | (250 | ) |   |   | 1,963 |   |   |   | 398 |   |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Net cash (used in) provided by      operating activities |   |           | (1,510 | )      |           |   | 3,452 |   |   |   | (4,867 | ) |   |   | 17,989 |   |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Cash      flows from investing activities:               |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Additions to plant and      equipment                    |   |           | (2,415 | )      |           |   | (2,718 | ) |   |   | (7,840 | ) |   |   | (6,816 | ) |
| Proceeds from sale of real      estate                   |   |           | -      |   |           |   | - |   |   |   | - |   |   |   | 2,416 |   |
| (Increase) decrease in      investments                  |   |           | 1,800  |   |           |   | 1,045 |   |   |   | 8,483 |   |   |   | (8,805 | ) |
| Purchase of Kinemetric      Engineering                  |   |           | 62     |   |           |   | - |   |   |   | (208 | ) |   |   | (2,060 | ) |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Net cash (used in) provided by      investing activities |   |           | (553   | )      |           |   | (1,673 | ) |   |   | 435 |   |   |   | (15,265 | ) |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Cash      flows from financing activities:               |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Proceeds from short-term      borrowings                 |   |           | 6,489  |   |           |   | 475 |   |   |   | 16,135 |   |   |   | 4,956 |   |
| Short-term debt      repayments                          |   |           | (1,337 | )      |           |   | (1,507 | ) |   |   | (5,702 | ) |   |   | (5,218 | ) |
| Proceeds from long-term debt      borrowings             |   |           | 1,188  |   |           |   | - |   |   |   | 1,188 |   |   |   | - |   |
| Long-term debt      repayments                           |   |           | (145   | )      |           |   | (160 | ) |   |   | (335 | ) |   |   | (384 | ) |
| Common stockissued                                       |   |           | 138    |   |           |   | 155 |   |   |   | 470 |   |   |   | 423 |   |
| Treasury shares      purchased                           |   |           | (75    | )      |           |   | - |   |   |   | (263 | ) |   |   | (317 | ) |
| Dividends                                                |   |           | (795   | )      |           |   | (660 | ) |   |   | (2,384 | ) |   |   | (2,638 | ) |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Net cash provided by (used in)      financing activities |   |           | 5,463  |   |           |   | (1,697 | ) |   |   | 9,109 |   |   |   | (3,178 | ) |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Effect      of exchange rate changes on cash             |   |           | (338   | )      |           |   | 10 |   |   |   | (1,998 | ) |   |   | 176 |   |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |
| Net      increase (decrease) in cash                     |   |           | 3,062  |   |           |   | 92 |   |   |   | 2,679 |   |   |   | (278 | ) |
| Cash,      beginning of period                           |   |           | 6,132  |   |           |   | 7,338 |   |   |   | 6,515 |   |   |   | 7,708 |   |
| Cash,      end of period                                 |   | $              | 9,194  |   |           | $      | 7,430 |   |   | $ | 9,194 |   |   | $ | 7,430 |   |
|                                                     |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |

----

|                                                                                                                                |   | March      28, 2009 (unaudited) |    |   | June      28, 2008 |   |
|-------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------------|---------|--------|--------------------|--------|
|                                                                                                                                |   |                                 |    |   |               |   |
| ASSETS                                                                                                                              |   |                                 |    |   |               |   |
| Current      assets:                                                                                                                |   |                                 |    |   |               |   |
| Cash                                                                                                                                |   | $                                    | 9,194   |   |               | $      | 6,515 |   |
| Investments                                                                                                                         |   |                                 | 8,068   |   |               |   | 19,806 |   |
| Accounts receivable (less      allowance for doubtful accounts of $560 and $701)                                                    |   |                                 | 27,470  |   |               |   | 39,627 |   |
| Inventories:                                                                                                                        |   |                                 |    |   |               |   |   |   |
| Raw materials and      supplies                                                                                                     |   |                                 | 20,474  |   |               |   | 15,104 |   |
| Goods in process and finished      parts                                                                                            |   |                                 | 18,482  |   |               |   | 16,653 |   |
| Finished goods                                                                                                                      |   |                                 | 24,414  |   |               |   | 29,400 |   |
|                                                                                                                                |   |                                 | 63,370  |   |               |   | 61,157 |   |
| Current deferred income tax      asset                                                                                              |   |                                 | 5,545   |   |               |   | 5,996 |   |
| Prepaid expenses, taxes and other      current assets                                                                               |   |                                 | 5,705   |   |               |   | 5,535 |   |
| Total current    assets                                                                                                             |   |                                 | 119,352 |   |               |   | 138,636 |   |
|                                                                                                                                |   |                                 |    |   |               |   |   |   |
| Property,      plant and equipment, at cost (less accumulated depreciation of $116,854      and $131,386)                           |   |                                 | 55,380  |   |               |   | 60,945 |   |
| Property      held for sale                                                                                                         |   |                                 | 1,912   |   |               |   | 1,912 |   |
| Intangible      assets (less accumulated amortization of $3,413 and$2,477)                                                          |   |                                 | 2,828   |   |               |   | 3,764 |   |
| Goodwill      (Note 4)                                                                                                              |   |                                 | 981     |   |               |   | 6,032 |   |
| Pension      asset                                                                                                                  |   |                                 | 35,683  |   |               |   | 34,643 |   |
| Other      assets                                                                                                                   |   |                                 | 276     |   |               |   | 1,877 |   |
| Long-term      taxes receivable                                                                                                     |   |                                 | 2,905   |   |               |   | 2,476 |   |
| Total assets                                                                                                                        |   | $                                    | 219,317 |   |               | $      | 250,285 |   |
|                                                                                                                                |   |                                 |    |   |               |   |   |   |
|                                                                                                                                |   |                                 |    |   |               |   |   |   |
| LIABILITIES      AND STOCKHOLDERS' EQUITY                                                                                           |   |                                 |    |   |               |   |   |   |
| Current      liabilities:                                                                                                           |   |                                 |    |   |               |   |   |   |
| Notes payable and current      maturities                                                                                           |   | $                                    | 14,403  |   |               | $      | 4,121 |   |
| Accounts payable and accrued      expenses                                                                                          |   |                                 | 11,347  |   |               |   | 18,041 |   |
| Accrued salaries and      wages                                                                                                     |   |                                 | 4,376   |   |               |   | 6,907 |   |
| Total current      liabilities                                                                                                      |   |                                 | 30,126  |   |               |   | 29,069 |   |
|                                                                                                                                |   |                                 |    |   |               |   |   |   |
| Long-term      taxes payable                                                                                                        |   |                                 | 8,624   |   |               |   | 8,522 |   |
| Deferred      income taxes                                                                                                          |   |                                 | 2,717   |   |               |   | 6,312 |   |
| Long-term      debt                                                                                                                 |   |                                 | 6,150   |   |               |   | 5,834 |   |
| Postretirement      benefit liability                                                                                               |   |                                 | 12,307  |   |               |   | 13,775 |   |
| Total liabilities                                                                                                                   |   |                                 | 59,924  |   |               |   | 63,512 |   |
|                                                                                                                                |   |                                 |    |   |               |   |   |   |
| Stockholders'      equity:                                                                                                          |   |                                 |    |   |               |   |   |   |
| Class      A Common $1 par (20,000,000 shrs. authorized)5,746,385      outstanding on 3/28/09,5,708,100      outstanding on 6/28/08 |   |                                 | 5,746   |   |               |   | 5,708 |   |
| Class      B Common $1 par (10,000,000 shrs. authorized)873,939      outstanding on 3/28/09,906,065      outstanding on 6/28/08     |   |                                 | 874     |   |               |   | 906 |   |
| Additional paid-in      capital                                                                                                     |   |                                 | 49,865  |   |               |   | 49,613 |   |
| Retained earnings reinvested      and employed in the business                                                                      |   |                                 | 130,733 |   |               |   | 134,109 |   |
| Accumulated other comprehensive      loss                                                                                           |   |                                 | (27,825 | )      |               |   | (3,563 | ) |
| Total stockholders'      equity                                                                                                     |   |                                 | 159,393 |   |               |   | 186,773 |   |
| Total liabilities and      stockholders’ equity                                                                               |   | $                                    | 219,317 |   |               | $      | 250,285 |   |

----

|                                                                    |   | Common      Stock Outstading($1      Par) |   | AdditionalPaid-in      Capital |         |   | Retained      Earnings |   |   | Accumulated      Other Comprehensive Loss |               |   | Total  |   |
|-------------------------------------------------------------------------|--------|------------------------------------------------|--------|--------------------------------|--------------|--------|------------------------|--------|--------|-------------------------------------------|--------------------|--------|--------|--------|
|                                                                    |   | Class      A                                   |   |                           | Class      B |   |                   |   |   |                                      | Prior      Quarter |   |   |   |   |   |   |   |
| Balance      June 30, 2007                                              |   | $                                              | 5,632  |                           |         | $      | 963                    |   |   | $                                         | 49,282             |   |   | $      | 127,023 |   |   | $ | (5,786 | ) |   | $ | 177,114 |   |
| Comprehensive      income (loss):                                       |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net earnings                                                            |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   | 8,615 |   |   |   |   |   |   |   | 8,615 |   |
| Unrealized net loss on investments      andswap agreement               |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | (85 | ) |   |   | (85 | ) |
| Translation gain,    net                                                |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | 5,376 |   |   |   | 5,376 |   |
| Total      comprehensive income                                         |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   | 13,906 |   |
| Tax      adjustment for FIN 48                                          |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   | (313 | ) |   |   |   |   |   |   | (313 | ) |
| Dividends      ($.40 per share)                                         |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   | (2,638 | ) |   |   |   |   |   |   | (2,638 | ) |
| Treasury      shares:                                                   |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Purchased                                                               |   |                                           | (20    | )                              |         |   |                   |   |   |                                      | (297               | )      |   |   |   |   |   |   |   |   |   |   | (317 | ) |
| Issued                                                                  |   |                                           | 20     |                           |         |   |                   |   |   |                                      | 322                |   |   |   |   |   |   |   |   |   |   |   | 342 |   |
| Issuance      of stock under ESPP                                       |   |                                           |   |                           |         |   | 5                      |   |   |                                      | 110                |   |   |   |   |   |   |   |   |   |   |   | 115 |   |
| Conversion                                                              |   |                                           | 51     |                           |         |   | (51                    | )      |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   | - |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      March 29, 2008                                             |   | $                                              | 5,683  |                           |         | $      | 917                    |   |   | $                                         | 49,417             |   |   | $      | 132,687 |   |   | $ | (495 | ) |   | $ | 188,209 |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      June 28, 2008                                              |   | $                                              | 5,708  |                           |         | $      | 906                    |   |   | $                                         | 49,613             |   |   | $      | 134,109 |   |   | $ | (3,563 | ) |   | $ | 186,773 |   |
| Comprehensive      income (loss):                                       |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Net loss                                                                |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   | (992 | ) |   |   |   |   |   |   | (992 | ) |
| Unrealized net gain on investments      andswap agreement               |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | 312 |   |   |   | 312 |   |
| Translation gain (loss),      net                                       |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | (24,574 | ) |   |   | (24,574 | ) |
| Total      comprehensive loss                                           |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   | (25,254 | ) |
| Dividends      ($.36 per share)                                         |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   | (2,384 | ) |   |   |   |   |   |   | (2,384 | ) |
| Treasury      shares:                                                   |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Purchased                                                               |   |                                           | (26    | )                              |         |   |                   |   |   |                                      | (237               | )      |   |   |   |   |   |   |   |   |   |   | (263 | ) |
| Issued                                                                  |   |                                           | 28     |                           |         |   |                   |   |   |                                      | 393                |   |   |   |   |   |   |   |   |   |   |   | 421 |   |
| Issuance      of stock under ESPP                                       |   |                                           |   |                           |         |   | 4                      |   |   |                                      | 96                 |   |   |   |   |   |   |   |   |   |   |   | 100 |   |
| Conversion                                                              |   |                                           | 36     |                           |         |   | (36                    | )      |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   | - |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Balance      March 28, 2009                                             |   | $                                              | 5,746  |                           |         | $      | 874                    |   |   | $                                         | 49,865             |   |   | $      | 130,733 |   |   | $ | (27,825 | ) |   | $ | 159,393 |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Cumulative      Balance:                                                |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Translation loss                                                        |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | (23,968 | ) |   |   |   |   |
| Unrealized net loss on investments      andswap agreements              |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | (29 | ) |   |   |   |   |
| Amounts not recognized as a      component of net periodic benefit cost |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   | (3,828 | ) |   |   |   |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   | $ | (27,825 | ) |   |   |   |   |
|                                                                    |   |                                           |   |                           |         |   |                   |   |   |                                      |               |   |   |   |   |   |   |   |   |   |   |   |   |   |

----

| o   | Level      1 – Financial assets whose values are based on unadjusted quoted prices      for identical assets or liabilities in an active market which the company      has the ability to access at the measurement date (examples include active      exchange-traded equity securities and most U.S. Government and agency      securities). |
|---------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| o   | Level      2 – Financial assets whose value are based on quoted market prices in      markets where trading occurs infrequently or whose values are based on      quoted prices of instruments with similar attributes in active markets.      The Company does not currently have any Level 2 financial      assets. |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| o   | Level      3 – Financial assets whose values are based on prices or valuation      techniques that require inputs that are both unobservable and significant      to the overall fair value measurement. These inputs reflect management’s      own view about the assumptions a market participant would use in pricing      the asset. The Company does not currently have any Level 3 financial      assets. |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|                                                     |   | Level 1 |   |
|----------------------------------------------------------|--------|---------|--------|
|                                                     |   |    |   |
| Money      Market Funds                                  |   |    | 2,570  |   |
| Certificates      of Deposits                            |   |    | 3,722  |   |
| International      Bonds (Puerto Rican debt obligations) |   |    | 1,776  |   |
|                                                     |   | $       | 8,068  |   |

----

|                         |   | As of March 28, 2009 |   |   | As of June 28, 2008      |   |
|------------------------------|--------|----------------------|--------|--------|--------------------------|--------|
|                         |   | Carrying Amount      |   |   | Accumulated Amortization |   |   | Net |   |   | Carrying Amount |   |   | Accumulated Amortization |   |   | Net |   |
|                         |   |                 |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Goodwill                     |   | $                    | 981    |   |                     |   | - |   |   | $ | 981 |   |   | $ | 6,032 |   |   |   | - |   |   | $ | 6,032 |   |
|                         |   |                 |   |   |                     |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Other      Intangible Assets |   | $                    | 6,241  |   |                     | $      | (3,413 | ) |   | $ | 2,828 |   |   | $ | 6,241 |   |   | $ | (2,477 | ) |   | $ | 3,764 |   |

----

|                                                 |   | Thirteen WeeksEnded March |   |   | Thirty-nine WeeksEnded March |   |
|------------------------------------------------------|--------|---------------------------|--------|--------|------------------------------|--------|
|                                                 |   | 2009                      |   |   | 2008                         |   |   | 2009 |   |   | 2008 |   |
|                                                 |   |                      |   |   |                         |   |   |   |   |   |   |   |
| Interest income                                      |   | $                         | 102    |   |                         | $      | 356 |   |   | $ | 643 |   |   | $ | 1,090 |   |
| Interest expense and commitment      fees            |   |                      | (221   | )      |                         |   | (108 | ) |   |   | (617 | ) |   |   | (561 | ) |
| Realized and unrealized exchange      gains (losses) |   |                      | 62     |   |                         |   | 708 |   |   |   | 1,160 |   |   |   | 787 |   |
| Gains on sale of real      estate                    |   |                      | -      |   |                         |   | - |   |   |   | - |   |   |   | 1,703 |   |
| Other                                                |   |                      | (144   | )      |                         |   | 199 |   |   |   | (32 | ) |   |   | 32 |   |
|                                                 |   | $                         | (201   | )      |                         | $      | 1,155 |   |   | $ | 1,154 |   |   | $ | 3,051 |   |

----

|                                    |   | Thirteen WeeksEnded March |   |   | Thirty-nine WeeksEnded March |   |
|-----------------------------------------|--------|---------------------------|--------|--------|------------------------------|--------|
|                                    |   | 2009                      |   |   | 2008                         |   |   | 2009 |   |   | 2008 |   |
|                                    |   |                      |   |   |                         |   |   |   |   |   |   |   |
| Service cost                            |   | $                         | 541    |   |                         | $      | 597 |   |   | $ | 1,670 |   |   | $ | 1,796 |   |
| Interest cost                           |   |                      | 1,639  |   |                         |   | 1,742 |   |   |   | 5,133 |   |   |   | 5,245 |   |
| Expected return on plan      assets     |   |                      | (2,490 | )      |                         |   | (2,944 | ) |   |   | (7,686 | ) |   |   | (8,853 | ) |
| Amort. of prior service      cost       |   |                      | 100    |   |                         |   | 111 |   |   |   | 314 |   |   |   | 335 |   |
| Amort. of unrecognized (gain)      loss |   |                      | (3     | )      |                         |   | (1 | ) |   |   | (8 | ) |   |   | (5 | ) |
|                                    |   | $                         | (213   | )      |                         | $      | (495 | ) |   | $ | (577 | ) |   | $ | (1,482 | ) |

|                              |   | Thirteen WeeksEnded March |   |   | Thirty-nine WeeksEnded March |   |
|-----------------------------------|--------|---------------------------|--------|--------|------------------------------|--------|
|                              |   | 2009                      |   |   | 2008                         |   |   | 2009 |   |   | 2008 |   |
|                              |   |                      |   |   |                         |   |   |   |   |   |   |   |
| Service cost                      |   | $                         | 88     |   |                         | $      | 98 |   |   | $ | 265 |   |   | $ | 294 |   |
| Interest cost                     |   |                      | 177    |   |                         |   | 186 |   |   |   | 531 |   |   |   | 557 |   |
| Amort. of prior service      cost |   |                      | (226   | )      |                         |   | (226 | ) |   |   | (679 | ) |   |   | (679 | ) |
| Amort. of unrecognized      loss  |   |                      | -      |   |                         |   | 28 |   |   |   | - |   |   |   | 85 |   |
|                              |   | $                         | 39     |   |                         | $      | 86 |   |   | $ | 117 |   |   | $ | 257 |   |

|                                                                                             |   | March      28, 2009 |   |   | June      28, 2008 |   |
|--------------------------------------------------------------------------------------------------|--------|---------------------|--------|--------|--------------------|--------|
|                                                                                             |   |                |   |   |               |   |
| Reducing    revolver                                                                             |   | $                   | 7,200  |   |               | $      | 7,200 |   |
| Capitalized      lease obligations – domestic (payable in U.S. dollars)                    |   |                | 1,131  |   |               |   | - |   |
| Capitalized      lease obligations payable in Brazilian currency due 2009-2011,      13.3%-23.7% |   |                | 778    |   |               |   | 1,569 |   |
|                                                                                             |   | $                   | 9,109  |   |               | $      | 8,769 |   |
| Less current      portion                                                                        |   |                | 2,959  |   |               |   | 2,935 |   |
|                                                                                             |   | $                   | 6,150  |   |               | $      | 5,834 |   |

----

| -   | How      investment decisions are made, including factors necessary to      understanding investment policies andstrategies |
|---------------|-----------------------------------------------------------------------------------------------------------------------------|

| -   | The      major categories of plan assets |
|---------------|------------------------------------------|

| -   | The      inputs and valuation techniques used to measure the fair value of plan      assets |
|---------------|---------------------------------------------------------------------------------------------|

| -   | The      effect of fair value measurements using significant unobservable inputs      (Level 3 measurements in Statement 157 on changes in plan assets for the      period) |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Significant      concentrations of risk within planassets |
|---------------|-----------------------------------------------------------|

----

----

----

----

| Cash      flows (in thousands)                         |   | 13 Weeks Ended |   |   | 39 Weeks Ended |   |
|--------------------------------------------------------|--------|----------------|--------|--------|----------------|--------|
|                                                   |   | 3/28/09        |   |   | 3/29/08        |   |   | 3/28/09 |   |   | 3/29/08 |   |
|                                                   |   |           |   |   |           |   |   |   |   |   |   |   |
| Cash (used by) provided by      operations             |   | $              | (1,510 | )      |           | $      | 3,452 |   |   | $ | (4,867 | ) |   | $ | 17,989 |   |
| Cash (used in) provided from      investing activities |   |           | (553   | )      |           |   | (1,673 | ) |   |   | 435 |   |   |   | (15,265 | ) |
| Cash provided from (used in)      financing activities |   |           | 5,463  |   |           |   | (1,697 | ) |   |   | 9,109 |   |   |   | (3,178 | ) |
|                                                   |   |           |   |   |           |   |   |   |   |   |   |   |   |   |   |   |

----

----

----

| o   | A      significant adverse change in legal factors or in the business      climate |
|---------------|------------------------------------------------------------------------------------|

| o   | An      adverse action or assessment by aregulator |
|---------------|----------------------------------------------------|

| o   | Unanticipated      competition |
|---------------|--------------------------------|

| o   | A      loss of key personnel |
|---------------|------------------------------|

| o   | A      more likely than not expectation that a reporting unit or significant      portion of a reporting unit will be sold or otherwise disposed      of |
|---------------|----------------------------------------------------------------------------------------------------------------------------------------------------------|

| o   | The      testing for recoverability of significant long lived asset groups under      FAS 144. |
|---------------|------------------------------------------------------------------------------------------------|

----

----

----

----

| ISSUER      PURCHASES OF EQUITY SECURITIES |
|--------------------------------------------|
| Period                                     | Shares      Purchased | Average      Price | Shares      Purchased Under Announced Programs | Shares      yet to be Purchased Under Announced Programs |
| 12/27/2008      - 2/2/2009                 | none | - | none | none |
| 2/3/2009      - 3/1/2009                   | 2,000 | 8.09 | 2,000 | none |
| 3/2/2009      - 3/28/2009                  | 9,400 | 6.22 | 9,400 | none |

|   | 10.l | Second      Amendment dated as of April 28,1009 to the Company’s Amended and Restated      Credit Agreement, filed herewith. |
|--------|------|------------------------------------------------------------------------------------------------------------------------------------|

|   | 31a | Certification      of Chief Executive Officer Pursuant to Rules 13a-15(e)/15(d)-15(e) and      13a-15(f)/15(d)-15(f). |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------|

|   | 31b | Certification      of Chief Financial Officer Pursuant to Rules 13a-15(e)/15(d)-15(e) and      13a-15(f)/15(d)-15(f). |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------|

|   | 32 | Certification      of Chief Executive Officer and Chief Financial Officer Pursuant to Rule      13a-14(b) and Section 906 of the Sarbanes-Oxley Act of 2002 (subsections      (a) and (b) of Section 1350, Chapter 63 of Title 18, United States      Code). |
|--------|----|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |             |   | THE      L. S. STARRETT COMPANY(Registrant)                      |
|--------|------------------|--------|------------------------------------------------------------------|
|   |             |   |                                                             |
|   |             |   |                                                             |
| Date   | May      7, 2009 |   | S/R.      J. Hylek                                               |
|   |             |   | R.      J. Hylek (Treasurer and Chief Financial Officer)         |
|   |             |   |                                                             |
| Date   | May      7, 2009 |   | S/S.      R.J. Simkevich                                         |
|   |             |   | R.J.      Simkevich (Corp. Controller/Chief Accounting  Officer) |

----