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                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 10-Q
(Mark One)

(X)   QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

                  For the quarterly period ended March 2, 2007

( )   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
      EXCHANGE ACT OF 1934

                       For the transition period from to .

                         Commission File Number: 1-4404

                           THE STRIDE RITE CORPORATION
             (Exact name of registrant as specified in its charter)

          Massachusetts                            04-1399290
        ------------------                    --------------------
   (State or other jurisdiction            (I.R.S. Employer Identified No.)
of Incorporation or Organization)

                191 Spring Street, Lexington, Massachusetts 02421
               (Address of principal executive offices) (Zip Code)

                                  (617)824-6000
                   ------------------------------------------
              (Registrant's telephone number, including area code)


     Indicate  by check mark  whether the  registrant  (1) has filed all reports
required 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 ( )

     Indicate by check mark whether the registrant is a large accelerated filer,
an accelerated filer, or a non-accelerated filer. See definition of "accelerated
filer and larger  accelerated  filer" in Rule 12b-2 of the Exchange Act.  (Check
One):

Large accelerated filer ( ) Accelerated filer (X) Non-accelerated filer ( )

     Indicate  by check mark  whether  the  registrant  is a shell  company  (as
defined in Rule 12b-2 of the Exchange Act).

          Yes( )          No (X)

As of March 30, 2007, 36,541,316 shares of the Registrant's common stock, $.25
par value, and the accompanying Preferred Stock Purchase Rights were
outstanding.


<PAGE>


PART I - FINANCIAL INFORMATION

ITEM 1.  Financial Statements

                           THE STRIDE RITE CORPORATION
<TABLE>
                      CONDENSED CONSOLIDATED BALANCE SHEETS
                                 (In thousands)


<CAPTION>
                                     March 2,                         March 3,
                                       2007          December 1,        2006
                                   (Unaudited)          2006         (Unaudited)
                                  ---------------   --------------  ------------

  Assets

  Current Assets:
     Cash and cash
<S>                                  <C>              <C>             <C>
      equivalents                    $19,982          $17,502         $23,219


     Accounts and notes
      receivable, net                128,733           75,263         121,098

     Inventories                     126,651          119,917         115,594

     Deferred income taxes            14,275           14,293          14,262

     Other current assets             17,048           16,676          18,074
                                    --------         --------       ---------

     Total current assets            306,689          243,651         292,247

  Property and equipment, net         52,950           53,472          51,625

  Goodwill                            70,257           70,575          56,732

  Trademarks and other
  intangibles                         71,890           71,890          58,590

  Other assets, net                   18,731           18,299          19,301
                                    --------         --------        ---------

     Total assets                   $520,517         $457,887        $478,495
                                    ========         ========        ========
</TABLE>















               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

<TABLE>
                           THE STRIDE RITE CORPORATION
                CONDENSED CONSOLIDATED BALANCE SHEETS (CONTINUED)
                      (In thousands, except for share data)

<CAPTION>
                                    March 2,                         March 3,
                                      2007         December 1,         2006
                                  (Unaudited)         2006           (Unaudited)
                                 ---------------  --------------   -------------

  Liabilities and Stockholders' Equity

  Current Liabilities:
<S>                                    <C>             <C>              <C>
     Accounts payable                  $32,327         $27,838          $28,120
     Income taxes payable               10,508           8,204            7,936
     Accrued expenses and other
       liabilities                      31,402          30,836           31,709
                                        ------          ------           ------
     Total current liabilities          74,237          66,878           67,765

  Long term debt                        98,500          54,200           95,000
  Deferred income taxes                 24,780          25,194           23,781
  Pension obligation and other
       long-term liabilities            15,060          14,886           15,153

  Stockholders' Equity:
     Preferred stock, $1 par value
       Shares authorized - 1,000,000
       Shares issued - None                  -               -                -

     Common stock, $.25 par value
       Share authorized - 135,000,000
       Shares issued and
       outstanding -
        36,533,131 on
        March 2,2007,
        36,320,579 on
        December 1, 2006 and
        36,711,809 on March
        3,2006                           9,152           9,087            9,172

     Capital in excess of par
       value                            30,425          26,962           22,634

    Retained earnings                  275,071         266,508          253,674
    Accumulated other
        comprehensive loss              (6,708)         (5,828)          (8,684)
                                       -------       - -------    --    -------
     Total stockholders' equity        307,940         296,729          276,796
                                       -------       - -------        ---------

     Total liabilities and
       stockholders' equity           $520,517        $457,887         $478,495
                                      ========        ========        =========
</TABLE>



               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION
<TABLE>
             CONDENSED CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED)
           For the three months ended March 2, 2007 and March 3, 2006
                    (In thousands, except for per share data)


<CAPTION>
                                                2007             2006
                                            --------------  ---------------

<S>                                           <C>            <C>
Net sales                                     $194,671       $183,416

Cost of sales                                  115,181        110,184
                                            ----------      ---------

Gross profit                                    79,490         73,232

Selling and administrative expenses             60,799         58,910
                                            ----------      ---------

Operating income                                18,691         14,322


Investment income                                 392             484
Interest expense                               (1,434)         (1,163)
Other income (expense), net                        (8)           (144)
                                            ----------      ----------


Income before income taxes                      17,641         13,499

Provision for income taxes                      (6,546)        (5,214)
                                            ----------      ---------


Net income                                     $11,095       $  8,285
                                            ==========      =========

Net income per common share:
   Diluted                                     $   .30       $    .22
                                            ==========      =========
   Basic                                       $   .30       $    .23
                                            ==========      =========

Dividends per common share                     $   .07       $    .06
                                            ==========      =========

Average common shares used in per share
  computations:
   Diluted                                      37,537         37,703
                                            ==========      =========
   Basic                                        36,556         36,588
                                            ==========      =========
</TABLE>



               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION
<TABLE>
           CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED)
           For the three months ended March 2, 2007 and March 3, 2006
                                 (In thousands)
<CAPTION>
                                                        2007             2006
                                                    --------------   -----------
Cash flows from operating activities:
<S>                                                       <C>           <C>
   Net income                                             $11,095       $8,285
   Adjustments to reconcile net income to net
     cash provided by operating activities:
   Depreciation and amortization                            4,257        3,898
   Deferred income taxes                                     (268)        (245)
   Compensation expense related to stock plans                731          721
   Gain on disposals of property and
   equipment                                                 (171)        (307)
   Other non-cash items                                      (193)           -
   Changes in:
      Accounts and notes receivable                       (54,110)     (57,565)
      Inventories                                          (6,796)         675
      Other current assets                                    129        6,352
      Other current liabilities                             6,775       (4,489)
      Other long-term assets                                 (552)         296
      Other long-term liabilities                             181        1,341
                                                         ---------     ---------
      Net cash used by operating activities               (38,922)     (41,038)
                                                         ---------    ----------

Cash flows from investing activities:
   Additions to property and equipment                     (3,266)      (3,850)
                                                       ----------     ----------
      Net cash used by investing activities                (3,266)      (3,850)
                                                       ----------     ----------

Cash flows from financing activities:
   Borrowings under revolving credit facility             213,800       54,000
   Payments under revolving credit facility              (169,500)     (19,000)
   Proceeds from sale of stock under stock plans            1,732        2,489
   Tax benefit in connection with exercise of
     stock options                                          1,019          629
   Cash dividends paid                                     (2,213)      (2,189)
   Repurchase of common stock                                   -       (1,587)
                                                          --------     ---------
      Net cash provided from financing activities          44,838       34,342
                                                          --------    ---------

Effect of exchange rate changes on cash and
      cash equivalents                                       (170)         671
                                                          --------    ---------

Net increase (decrease) in cash and cash
equivalents                                                 2,480       (9,875)

Cash and cash equivalents at beginning of the
   period                                                  17,502       33,094
                                                           ------    ---------

Cash and cash equivalents at end of the period            $19,982      $23,219
                                                          =======    =========
Cash paid for interest expense                            $ 1,342      $   970
Cash paid for income taxes                                $ 1,883      $ 3,266
</TABLE>

               The accompanying notes are an integral part of the
                  condensed consolidated financial statements.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION
              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 -   Summary of Significant Accounting Policies

      Basis of Presentation

     The  financial  information  included  in this Form 10-Q of The Stride Rite
Corporation  (the  "Company")  for the periods  ended March 2, 2007 and March 3,
2006 is unaudited. Such information includes all adjustments (including only and
all normal  recurring  adjustments)  which,  in the opinion of  management,  are
considered  necessary for a fair  presentation of the  consolidated  results for
those periods. The results of operations for the periods ended March 2, 2007 and
March 3, 2006 are not  necessarily  indicative of the result of operations  that
may be expected for the complete  fiscal year.  The year-end  condensed  balance
sheet data was derived from audited financial  statements,  but does not include
all  disclosures  required by accounting  principles  generally  accepted in the
United States of America.  The Company has previously  filed with the Securities
and Exchange Commission audited  consolidated  financial statements for the year
ended  December  1,  2006 on Form  10-K,  which  includes  all  information  and
footnotes necessary for such presentation.

     The  Company's  preparation  of financial  statements  in  conformity  with
accounting  principles  generally  accepted  in the  United  States  of  America
requires  management to make estimates and assumptions  that affect the reported
amounts  of assets and  liabilities  and  disclosure  of  contingent  assets and
liabilities at the dates of the financial statements and the reported amounts of
revenues  and  expenses  during the  respective  periods.  The most  significant
estimates included in these financial  statements  include valuation  allowances
and reserves for accounts receivable, sales returns allowances, markdowns (which
reduce revenues),  inventory valuation, income taxes, assumptions related to the
defined benefit pension plan; assumptions used in the calculation of share-based
compensation  costs,  assumptions  and estimates  used in valuing the assets and
liabilities  acquired  through  business  acquisitions,  and estimates of future
undiscounted  cash flows on property and equipment that may be impaired.  Actual
results could differ materially from those estimates.

Stock Purchase and Option Plans

     During  2002,   the  Company's   stockholders   approved  The  Stride  Rite
Corporation  Amended and Restated  Employee Stock  Purchase  Plan.  Amending the
Employee Stock Purchase Plan, among other things, increased the number of common
shares  available  for  issuance  thereunder  by  500,000  shares  to a total of
6,140,000  shares.  Under the Plan,  participating  associates can authorize the
Company to withhold up to 10% of their earnings during  consecutive  three month
payment  periods for the purchase of shares.  At the  conclusion  of the period,
associates  can  purchase  shares at 95% of the  market  value of the  Company's
common stock on the last day of the payment period. For the payment period which
ended in December  2006, a total of 10,509 shares were issued under the Plan for
an  aggregate  amount of $151  thousand.  At March 2, 2007, a total of 5,959,889
shares had been purchased under the Plan since inception and 180,111 shares were
available for purchase by participating associates.

     During  1998,   the  Company's   stockholders   approved  The  Stride  Rite
Corporation  1998  Non-Employee  Director Stock Ownership  Plan.  Under the 1998
Director's Plan, awards of common stock and options to purchase common stock are
granted to any director who is not an employee of the Company in accordance with

<PAGE>

the  provisions  of the Plan.  During  April 2003,  the  Company's  stockholders
approved an  amendment  to the 1998  Director's  Plan  increasing  the number of
shares of common stock authorized for issuance from 300,000 to 600,000.  Options
to purchase  common  stock are granted at a price equal to the closing  price of
the Company's common stock on the date the option is granted.  Directors receive
an annual  grant of options to purchase  5,000  shares of common stock under the
Plan. Options have a term of ten years and are non-transferable. Under the Plan,
options become exercisable over a three-year period and must be paid for in full
at the time of exercise.  In April 1999, the stockholders  approved an amendment
to the Plan which  allowed  directors to receive  their annual  retainer  either
entirely in shares of common  stock or  one-half  in shares of common  stock and
one-half in cash at the election of each  director.  In addition,  directors may
defer  receipt of the stock  (deferred  stock unit) and/or cash portion of their
annual   retainer  by  electing  to  participate   in  the  Company's   Deferred
Compensation  Plan for  Directors.  At March 2, 2007,  the  issuance  of 136,886
shares has been deferred by participating  directors.  At March 2, 2007, 113,121
options were available to grant under the 1998 Director's Plan.

     During 2004, the Company's  stockholders  approved an amendment to the 2001
Stock Option and Incentive Plan. This amendment,  among other things,  increased
the number of common shares of stock  reserved and available for issuance  under
the 2001 plan to  6,000,000  shares,  of which  3,000,000  shares  represent  an
increase over the previous number of shares reserved.  The 2001 Stock Option and
Incentive  Plan,  which  expires in April  2011,  replaced  a similar  long-term
incentive plan which had been approved by the  stockholders  in 1998.  Under the
Plan, as amended,  options to purchase common stock and stock awards of up to an
aggregate of 6,000,000  shares of the  Company's  common stock may be granted to
officers  and other key  associates.  At March 2,  2007,  957,490  options  were
available  to grant under the 2001 plan.  The option price of the shares may not
be less than the fair market value of the Company's  common stock at the date of
grant.  Options issued under the Plan prior to fiscal 2005 generally vest over a
three-year  period and the rights to  purchase  common  shares  expire ten years
following  the date of grant.  Options  issued  since the  beginning of the 2005
fiscal  year  generally  vest over a  four-year  period and expire  seven  years
following the date of grant. During the first quarter of fiscal 2007 certain key
executives and employees were granted  awards of restricted  stock  representing
135,050 shares of common stock under the 2001 plan.  Certain of these restricted
shares are subject to pre-established performance criteria, which may affect the
number  of  restricted  shares  received.  If  issued,  these  performance-based
restricted  shares will vest over four years in equal annual  installments.  The
restricted shares which were issued without performance criteria will vest three
years after the grant date.


     A summary of the  activity in stock  options  with respect to all plans for
the three months ended March 2, 2007 is as follows:

<TABLE>

<CAPTION>
                                             Number of          Weighted Average
                                              Options           Exercise Price
--------------------------------------------------------------------------------
<S>                                          <C>                      <C>
Outstanding at December 1, 2006              3,812,420                $  9.98
Granted                                        693,525                  16.82
Exercised                                     (162,500)                  9.73
Canceled                                       (72,981)                  9.29
                                         --------------             ---------

Outstanding at March 2, 2007                 4,270,464                $ 11.08
                                         =============                =======
</TABLE>




<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


     A summary of the  activity in  restricted  stock awards with respect to the
2001 plan for the three months ended March 2, 2007 is as follows:


<TABLE>
<CAPTION>
                                             Number of
                                            Restricted          Weighted Average
                                           Stock Awards         Exercise Price
--------------------------------------------------------------------------------
Outstanding at December 1, 2006               240,033                    -
<S>                                           <C>
Granted                                       135,050                    -
Exercised                                     (69,319)                   -
Canceled                                            -                    -
                                         ------------              -------

Outstanding at March 2, 2007                  305,764                    -
                                         ============              =======
</TABLE>




<PAGE>



PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

     The following table summarizes  information about stock options outstanding
at March 2, 2007:

<TABLE>
<CAPTION>
                                 Weighted
                                 Average      Weighted
   Range of                      Remaining    Average     Aggregate
   Exercise            Number   Contractual   Exercise    Intrinsic
    Prices        Outstanding      Life       Price        Value
--------------    -----------   -----------   ---------  -----------

<C>   <C>             <C>        <C>            <C>      <C>
$5.00-$6.88           930,530    3.6 years      $6.61    $8,495,739
$7.38-$10.63          809,465    5.5 years       8.24     6,070,988
$10.64-$12.25       1,098,195    5.9 years      11.55     4,601,437
$12.95-$16.82       1,432,274    6.5 years      15.24       716,137
                    ---------    ---------      -----   -----------
                    4,270,464    5.9 years     $11.08   $19,884,301
                    =========    =========     ======   ===========
</TABLE>


     The following table summarizes  information about stock options exercisable
at March 2, 2007:

<TABLE>
<CAPTION>
                                Weighted
                                Average     Weighted
   Range of                    Remaining    Average     Aggregate
   Exercise         Number    Contractual   Exercise    Intrinsic
    Prices       Exercisable      Life       Price        Value

<C>   <C>             <C>        <C>            <C>      <C>
$5.00-$6.88           930,530    3.6 years      $6.61    $8,495,739
$7.38-$10.63          803,632    5.5 years       8.23     6,035,276
$10.64-$12.25         776,047    6.1 years      11.41     3,360,284
$12.95-$16.82         162,251    5.9 years      13.72       327,745
                 --   -------    ---------      ----- ----  -------
                    2,672,460    5.6 years      $9.56   $18,219,044
                    =========    =========      =====   ===========
</TABLE>


     In December 2004, the Financial Accounting Standards Board issued Statement
of Financial  Accounting  Standards No.  123(R),  "Share-Based  Payment"  ("SFAS
123R"), which requires all share-based  payments to employees,  including grants
of employee stock options, to be recognized in the financial statements based on
their fair values. SFAS 123R revises SFAS No. 123 and supersedes APB Opinion No.
25, "Accounting for Stock Issued to Employees".  Effective December 3, 2005, the
Company  adopted  the  provisions  of SFAS 123R using the  modified  prospective
application  transition  method.  Under this transition method, the compensation
cost related to all equity  instruments  granted prior to, but not yet vested as
of adoption of the standard is recognized  based on the grant-date fair value as
estimated in accordance with the original provisions of SFAS 123. The grant-date
fair value of the  awards  generally  vest over the  service  period.  Under the
provisions  of SFAS 123R,  the Company is required to include an estimate of the
number of the  awards  that  will be  forfeited.  Previously,  the  Company  had
recognized the impact of forfeitures as they occurred.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

     Share-based  compensation  cost was $731 thousand and $721 thousand for the
three months ended March 2, 2007 and March 3, 2006, respectively. The portion of
share-based  compensation cost included in selling and  administrative  expenses
for the three months ended March 2, 2007 and March 3, 2006 was $651 thousand and
$616  thousand,  respectively.  The  portion of  share-based  compensation  cost
included in cost of sales for the three  months ended March 2, 2007 and March 3,
2006 was $80  thousand  and $105  thousand,  respectively.  The  Company did not
capitalize  any  share-based  compensation  cost as the costs that qualified for
capitalization  were not material.  The related tax benefit from the exercise of
shares  recognized in the three months ended March 2, 2007 and March 3, 2006 was
$1.0 million and $295 thousand, respectively.

     The  weighted  average  grant date fair value  used in the  calculation  of
share-based   compensation  cost  in  the  accompanying  condensed  consolidated
statements  of  income  for the  three  months  ended  March  2,  2007  has been
calculated  using the  Black-Scholes  option  pricing  model with the  following
weighted average assumptions:

<TABLE>
<CAPTION>
Employee Stock Options                                 2007       2006
-----------------------------------------------------------------------
<S>                                                   <C>        <C>
Risk-free interest rate                               4.76%      4.32%
Dividend yield                                         1.8%       1.8%
Volatility factor                                     29.5%      26.6%
Weighted average
   expected life of options (years)                    4.75       4.75
</TABLE>

     The weighted  average  expected  life of options was  calculated  using the
simplified method as provided by the Securities and Exchange  Commission's Staff
Accounting  Bulletin  No. 107.  This  decision was based on the lack of relevant
historical data due to decreasing the option's contractual term from 10 years to
7 years and  increasing  the vesting  period from 3 years to 4 years for options
that were granted  starting in fiscal year 2005.  The  risk-free  interest  rate
assumption was based on the United States  Treasury's  constant  maturity's rate
for a 4.75  year  term on the  date  the  option  was  granted.  The  volatility
assumption was based on weekly historical volatility during the time period that
corresponds  to the expected  weighted  average life of the option.  The assumed
dividend  yield  was  based on the  Company's  expectation  of  future  dividend
payouts.  The post-vesting  forfeiture rate is based on the four year historical
average  turnover  rate for two  groups  of  option  eligible  employees.  These
assumptions are evaluated, and revised as necessary,  based on changes in market
conditions and historical experience.

     The weighted average grant date fair values of stock options granted during
the three months  ended March 2, 2007 and March 3, 2006 were  estimated at $4.70
and $3.46, respectively.

     Total  unrecognized  share-based  compensation  costs related to non-vested
stock options was  approximately  $8.9 million as of March 2, 2007 which related
to  approximately  1.9 million  shares with a per share weighted value of $4.66.
This  unrecognized  cost is expected to be  recognized  over a weighted  average
period of approximately 3 years. The intrinsic value of options exercised during
the three months ended March 2, 2007 was approximately $2.5 million.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 2 - Earnings Per Share

     Basic  earnings  per common  share  excludes  dilution  and is  computed by
dividing net income  available to common  stockholders  by the weighted  average
number of common shares  outstanding  (which includes  deferred stock units, see
Note 1) for the period. Diluted earnings per common share reflects the potential
dilution  that  could  occur if stock  options  and other  types of  stock-based
compensation that issue common stock are exercised.

     The following is a reconciliation of the number of shares used in the basic
and diluted earnings per share computations:

<TABLE>
                                                 Three Months Ended
                                       ---------------------------------------
<CAPTION>
                                             March 2,              March 3,
                                               2007                  2006
                                       ---------------------     -------------
                                       (In thousands, except for per share data)

<S>                                            <C>                      <C>
Net income                                     $11,095                  $ 8,285
                                               =======                  =======


Weighted average common shares
  outstanding (basic)                           36,556                   36,588

Dilutive effect of share-based
  compensation                                     981                    1,115
                                               -------                  -------

Weighted average common shares
  outstanding (diluted)                         37,537                   37,703
                                               =======                   ======

Earnings per common share:
     Basic                                     $   .30                  $   .23
                                               =======                  =======

     Diluted                                   $   .30                  $   .22
                                               =======                  =======
</TABLE>


     The  following  weighted  shares have been excluded in the  computation  of
diluted earnings per share because the weighted shares are anti-dilutive:

                                                  First Quarter
                                           ----------------------------
                                                  2007            2006
                                           ------------    ------------
                                                 (In thousands)

Anti-dilutive weighted shares                    1,149             944




<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 3 - Comprehensive Income

<TABLE>
      Comprehensive income is as follows:

<CAPTION>
                                                        Three Months Ended
                                             -----------------------------------
                                                    March 2,           March 3,
                                                      2007               2006
                                              ------------------  --------------
                                                          (In thousands)

<S>                                                  <C>                 <C>
Net income                                           $11,095             $8,285

Other comprehensive income:
Foreign currency translation adjustments                (880)               783
                                                    ---------            ------

Total comprehensive income                          $ 10,215             $9,068
                                                    ========             ======
</TABLE>



<TABLE>
     Components  of  accumulated  other   comprehensive   loss  consist  of  the
following:

<CAPTION>
                                    March 2,        December 1,       March 3,
                                      2007             2006             2006
                               ---------------  ----------------  --------------
                                                  (In thousands)
Foreign currency  translation
<S>                                  <C>            <C>                  <C>
   adjustments                       $1,505         $2,385               $730
Minimum pension liability
   adjustments, net of taxes         (8,213)        (8,213)            (9,414)
                                    -------       ---------         -  -------
Accumulated other
   comprehensive loss               $(6,708)      $ (5,828)           $(8,684)
                                    ========      =========           ========
</TABLE>


Note 4 - Robeez Acquisition

     On September 5, 2006, the Company  purchased all of the outstanding  shares
of three  holding  companies  that,  together  with their  direct  and  indirect
subsidiaries,  constitute  the Robeez Group  ("Robeez")  for a purchase price of
approximately $28.7 million, net of cash acquired.  As a result, Robeez became a
wholly-owned subsidiary of the company. Robeez was purchased using cash provided
from  operations in addition to  approximately  $17 million  borrowed  under our
existing revolving credit facility.

     As part of the  acquisition  and in the fourth quarter of 2006, the Company
terminated   certain  executives  at  a  cost  of  approximately  $1.3  million.
Additionally,  approximately $313 thousand of other acquisition liabilities were
incurred   relating  to  lease   termination   costs  on  equipment   and  other
miscellaneous expenses.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
      Details of the Robeez acquisition related reserves at March 2, 2007 as are
follows:
<CAPTION>
                                       Acquisition        Acquisition
                                         Related            Related
                                        Severance          Exit Costs
------------------------------------------------------------------------
<S>                                        <C>                  <C>
Balance at December 1,2006                 $1,191               $304
Deductions from reserve                     (434)                  -
Foreign currency translation impact          (31)                (8)
                                      -----------         -----------
                                             $726               $296
                                      ===========         ===========
</TABLE>

Note 5 - Debt

     In connection with the  acquisition of Saucony,  the Company entered into a
five-year  revolving  credit  facility  pursuant  to a  Credit  Agreement  dated
September 16, 2005 (the "Credit  Agreement').  The Credit Agreement provides for
collateralized  revolving  loans in an aggregate  amount up to $275 million (the
"revolver"),  including a $75 million  sublimit  for the  issuance of letters of
credit  and a $15  million  sublimit  for  swingline  loans,  with $200  million
currently  committed.  Borrowings  under the Credit  Agreement  are scheduled to
mature on September 16, 2010 and are  collateralized by substantially all of the
assets of the Company.

     During  the first  quarter of fiscal  2007,  borrowings  under this  Credit
Agreement  averaged  $71.9 million,  with a maximum amount  outstanding of $98.5
million. For the same period in the prior fiscal year, borrowings averaged $78.1
million  with a  maximum  borrowing  of $101.0  million.  The  weighted  average
interest rate on these  borrowings  during the first quarter of fiscal year 2007
was 7.97% versus 5.80% in the prior year's  quarter.  On March 2, 2007 and March
3, 2006, $98.5 million and $95.0 million,  respectively,  were outstanding under
the revolver.  Cash interest  payments were $1.4 million and $1.1 million in the
first quarter of fiscal year 2007 and 2006, respectively.


Note 6 - Benefit Plans

<TABLE>
      The following table summarizes the components of net periodic benefit cost
for the Company:
<CAPTION>
                                                      Three Months Ended
                                              ----------------------------------
                                                    2007               2006
                                              ----------------   ---------------
                                                        (In thousands)
Service cost                                        $    -              $570
<S>                                                  <C>               <C>
Interest cost                                        1,108             1,029
Expected return on assets                           (1,173)           (1,143)
Net loss recognized                                    190               510
Amortization of prior service cost                       -                 3
                                                    ------            ------

Net periodic benefit cost                           $  125              $969
                                                    ======            ======
</TABLE>

     During the first quarter of fiscal 2007, no contributions  were made to the
Company's  defined benefit pension plan. At this time, the Company does not plan
to make any  contributions  to its defined  benefit pension plan during the 2007
fiscal year.
<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

     On June 29,  2006,  the Company  announced  changes to its defined  benefit
pension plan effective  December 31, 2006 that included  stopping the accrual of
future  benefits  in the  Company's  defined  benefit  pension  plan  and  fully
preserving  all  retirement  benefits  that  employees  will  have  earned as of
December 31,  2006.  At the same time the company  also  announced  changes that
included  significant  increases  to the matching  contributions  to its defined
contribution  plan  beginning  January 1, 2007.  The impact of the change to the
defined  benefit plan was a curtailment of the projected  benefit  obligation of
$2.7 million and no change to the accumulated  benefit  obligation.  The defined
contribution  plans were redesigned to increase the Company match from 3% of pay
up to 6% of pay and to allow all  participants  to make full use of the  maximum
statutory deferral limits.


Note 7 - Contingencies

     The revenue of Tommy Hilfiger branded footwear is a significant  portion of
the Company's business.  The Tommy Hilfiger footwear sales are contingent on the
Company's licensing agreement with Tommy Hilfiger Licensing,  Inc. In July 2006,
the Company amended the terms of the current license  agreement,  which extended
the term of the  agreement to expire in March 2008.  During the first quarter of
fiscal 2007, the Company entered into an additional extension of the term of the
agreement  through  December  2008.  Whether the  Company's  license  with Tommy
Hilfiger will remain in effect depends in part on the Company  achieving certain
minimum sales levels for the licensed products.  The Company continues to expect
to meet  the  minimum  sales  levels  required  by the  Tommy  Hilfiger  License
agreement.  The Company  believes  that no provision  is currently  required for
costs  related to the  potential  loss of this  license.  If the Tommy  Hilfiger
license is lost,  the  Company's  business  would be  materially  and  adversely
affected.  Revenues derived from our Tommy Hilfiger licenses were  approximately
$21 million in the first quarter of fiscal 2007. This revenue is included in the
Tommy  Hilfiger   Footwear  segment,   the  Other  Wholesale   Footwear  segment
(specifically the Stride Rite  International  division),  Stride Rite Children's
Group - Retail  division,  and the  Stride  Rite  Children's  Group -  Wholesale
Division.

     In December 2004, Saucony,  Inc. recorded a charge to address environmental
conditions  at a Saucony  owned  distribution  facility.  The  facility  and the
related  liability  were  acquired  by  the  Company  as  part  of  the  Saucony
acquisition  in September  2005. The liability as of March 2, 2007 is $1,829,000
and is included as an accrued expense in the accompanying condensed consolidated
balance  sheet.   The  original   estimated  costs  ranged  from  $1,242,000  to
$4,621,000.  The Company's  management  determined that the liability was fairly
stated upon  acquisition.  The  assessment of the  liability and the  associated
costs are an estimate based upon available  information after  consultation with
environmental  engineers,  consultants  and  attorneys  assisting the Company in
addressing these environmental issues. Actual costs to address the environmental
conditions  may change based upon further  investigations,  the  conclusions  of
regulatory  authorities about information gathered in those investigations,  and
due to the  inherent  uncertainties  involved in  estimating  conditions  in the
environment  and the  costs of  addressing  such  conditions.  During  the first
quarter of the fiscal 2007,  there were $36 thousand of costs  deducted from the
reserve.
<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 8 - Operating Segments and Related Information

     In September 2005 the Company acquired Saucony, Inc. During the 2006 fiscal
year,  Saucony's  operations were integrated into the existing operations of the
Company.  As a result,  during the first  quarter of fiscal  2006,  the  Company
re-assessed   its  operating  and  reportable   segments  under  SFAS  No.  131,
"Disclosures  about  Segments of an  Enterprise  and Related  Information".  The
changes to the Company's  segments were as follows:  the Stride Rite  Children's
Group - Retail Division includes the Saucony factory outlet stores (15 stores as
of March 2, 2007); Saucony's international operations are included in the Stride
Rite International division, which is aggregated in the Other Wholesale Footwear
reportable  segment and the Saucony domestic footwear  division,  which includes
the Hind unit, is also aggregated into the Other Wholesale  Footwear  reportable
segment.

     In September  2006, the Company  completed its acquisition of three holding
companies that, together with their direct and indirect subsidiaries, constitute
the Robeez Group  ("Robeez")  pursuant to a Share  Purchase  Agreement.  At that
time,  Robeez became our wholly-owned  subsidiary.  Robeez results of operations
have been included in our results since the date of acquisition. Robeez has been
reported  as a  separate  segment  since  the  date  of  acquisition,  based  on
management's   evaluation   of  the  business  for  the  purposes  of  assessing
performance and allocating resources.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
Segment information for the three months ended March 2, 2007 and March 3, 2006
is as follows:

<CAPTION>
             Stride    Stride
             Rite      Rite
First        Children'sChildren's Other     Tommy           Unallocated
Quarter      Group -   Group -    Whlsle   Hilfiger          Corporate   Consol-
2007         Retail    Whlsle    Footwear  Footwear  Robeez  & Other     idated
--------------------------------------------------------------------------------

Sales        $43,129   $20,980   $112,235  $15,472   $7,084        -   $198,900

Inter-
company
sales              -       (48)    (3,273)    (771)    (137)       -     (4,229)
             -------   --------  --------- --------  -------  ------   ---------

Net sales
to
external
customers    $43,129   $20,932   $108,962  $14,701   $6,947        -   $194,671
             =======   =======   ========  =======   ======   ======   =========

Operating
(loss)
<S>          <C>       <C>       <C>         <C>      <C>    <C>       <C>
  Income     $(2,502)  $ 2,515   $ 18,661    $ 828    $ 398  $(1,209)  $ 18,691

Interest
  and
other,
net                -         -          -        -        -   (1,050)    (1,050)
             --------  --------  ---------  -------  -------  -------  ---------

Income
(loss)
  before
  income
  taxes      $(2,502)  $ 2,515   $ 18,661  $   828  $   398  $(2,259)  $ 17,641
             ========   =======  ========  =======  =======  ========  ========

Total assets $49,498   $47,085   $322,254  $16,326  $38,898  $46,456   $520,517
              =======   =======  ========  =======  =======  =======   ========
</TABLE>



<PAGE>



PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

<TABLE>
<CAPTION>
             Stride    Stride
             Rite      Rite
First        Children'sChildren's Other     Tommy            Unallocated
Quarter      Group -   Group -    Wholesale Hilfiger          Corporate  Consol-
2006         Retail    Wholesale  Footwear  Footwear  Robeez   & Other    idated
-----------------------------------------------------------------------------------

Sales         $37,924   $21,156   $112,960  $14,933        -        -  $186,973

Inter-
  company
  sales             -       (27)    (2,665)    (865)       -        -    (3,557)
              -------   --------  --------- --------   ------   ------ ---------

Net sales
  to
  external
  customers   $37,924   $21,129   $110,295  $14,068        -        -  $183,416
              =======   =======   ======== ========  =======    ====== ========


Operating
  (loss)
<S>           <C>       <C>       <C>        <C>          <C> <C>      <C>
  income      $(2,088)  $ 2,802   $ 16,908   $ (338)       -  $(2,962) $ 14,322

Interest
  and
  other,
  net               -         -          -        -        -     (823)     (823)
              -------   -------   --------   ------  -------   -------  -------

Income
(loss)
  before
  income
  taxes       $(2,088)  $ 2,802   $ 16,908  $  (338)       -  $(3,785) $ 13,499
              =======   =======   ========  ========  ======  =======  ========

Total assets  $44,457   $48,610   $304,958  $14,615        -  $65,855  $478,495
              =======   =======   ========  ========  ======  =======  ========
</TABLE>



Note 9 - Recent Accounting Pronouncements

     In  September  2006,  the FASB issued  Statement  of  Financial  Accounting
Standards  ("SFAS")  No. 158 ("SFAS  158"),  Employers'  Accounting  for Defined
Benefit Pension and Other Postretirement  Plans, an amendment of FASB Statements
No. 87, 88, 106 and 132 (R).  This  Statement  requires  an  employer  that is a
business entity and sponsors one or more single-employer defined benefit pension
plans to  recognize  the  funded  status of a  benefit  plan -  measured  as the
difference  between plan assets at fair value (with limited  exceptions) and the
benefit  obligation - in its statement of financial  position.  It also requires
companies to recognize as a component of other comprehensive income, net of tax,
the gains and losses and prior  service  costs or credits  that arise during the
period  but are not  recognized  as  components  or net  periodic  benefit  cost
pursuant to FASB  Statement No. 87; to measure  defined  benefit plan assets and
obligations  as of the  date of the  employer's  fiscal  year-end  statement  of
financial  position;  and to disclose in the notes to the  financial  statements
certain other information.  The provisions of this statement are effective as of
the end of fiscal  years ending  after  December 15, 2006.  The Company does not
expect the  provisions  of SFAS 158 to have a material  impact on its  financial
position, results of operations and cash flows.

<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS


     In June  2006,  the  FASB  issued  FASB  interpretation  No.  48  ("FIN48")
"Accounting for Uncertainty in Income Taxes", an interpretation of SFAS No. 109,
"Accounting for Income Taxes" ("SFAS 109").  This  interpretation  clarifies the
accounting  for  uncertainty  in  income  taxes  recognized  in an  enterprise's
financial  statements  in  accordance  with SFAS No. 109.  FIN 48  prescribes  a
recognition  threshold and  measurement  attribute  for the financial  statement
recognition and measurement of a tax position taken or expected to be taken in a
tax return.  FIN 48 also provides  guidance on  de-recognition,  classification,
interest  and  penalties,   accounting  in  interim   periods,   disclosure  and
transition.  This  interpretation  is effective for fiscal years beginning after
December 15, 2006;  the Company's  first quarter of fiscal 2008.  The Company is
currently  evaluating  the  provisions  of FIN 48 to determine the impact on our
financial position, results of operations and cash flows.

     In September 2006, the FASB issued SFAS No. 157, "Fair Value  Measurements"
("SFAS No. 157").  SFAS No. 157 defines fair value,  establishes a framework for
measuring  fair  value  and  requires  enhanced  disclosures  about  fair  value
measurements.  SFAS No. 157  requires  companies  to disclose  the fair value of
their  financial  instruments  according to a fair value hierarchy as defined in
the standard. Additionally, it requires companies to provide enhanced disclosure
regarding financial instruments in Level 3 of the fair value hierarchy. SFAS No.
157 is effective  for  financial  statements  issued for fiscal years  beginning
after  November 15, 2007,  and interim  periods  within those fiscal  years.  We
believe  the  adoption  of SFAS No. 157 will not have a  material  impact on our
financial position, results of operations and cash flows.



<PAGE>



PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

Overview
--------

     The following discusses The Stride Rite Corporation's results of operations
and liquidity and capital resources. The discussion,  including known trends and
uncertainties  identified by management,  should be read in conjunction with the
condensed consolidated financial statements and related notes.

     This Form 10-Q contains  forward-looking  statements  within the meaning of
the  Private  Securities  Litigation  Reform Act of 1995 and  Section 21E of the
Securities  Exchange Act of 1934. We caution investors that any  forward-looking
statements  presented in this report and presented  elsewhere by management from
time to time are based on  management's  beliefs  and  assumptions  made by, and
information   currently   available  to,   management.   When  used,  the  words
"anticipate",   "believe",   "expect",   "intend",  "may",  "plan",  "estimate",
"project",  "should",  "will be" and  similar  expressions  which do not  relate
solely  to   historical   matters  are  intended  to  identify   forward-looking
statements.  Such statements are subject to risks, uncertainties and assumptions
and are not guarantees of future performance, which may be affected by known and
unknown risks,  trends,  uncertainties  and factors that are beyond our control.
Should  one or more of  these  risks or  uncertainties  materialize,  or  should
underlying assumptions prove incorrect,  actual results may vary materially from
those   anticipated,   estimated  or  projected.   We  expressly   disclaim  any
responsibility to update forward-looking statements.  Accordingly,  past results
and trends  should not be used by  investors  to  anticipate  future  results or
trends.

     Risks and  uncertainties  that may affect future  performance  are detailed
from time to time in reports filed by the Company with the SEC,  including Forms
10-Q and 10-K, and include, among others, the following:  the inability to fully
realize the anticipated  benefits from the acquisitions of Robeez Footwear,  the
challenges of achieving the expected  synergies  with Robeez  Footwear,  and the
possibility of incurring costs or difficulties related to the integration of the
business of Stride Rite and Robeez Footwear and Saucony; increased leverage from
the  financing of our recent  acquisitions;  the possible  failure to retain the
Tommy  Hilfiger  footwear  license;  international,  national and local  general
economic and market conditions;  the size and growth of the overall footwear and
general  retail  market;   intense   competition  among  designers,   marketers,
distributors and sellers of footwear;  demographic changes;  changes in consumer
fashion trends that may shift to footwear styling not currently  included in our
product  lines;  popularity  of particular  designs and  categories of products;
seasonal and  geographic  demand for the  Company's  products;  difficulties  in
anticipating  or  forecasting  changes in  consumer  preferences;  delays in the
opening of new stores;  difficulties in implementing,  operating and maintaining
the  Company's  complex  information  systems and controls,  including,  without
limitation,  the systems related to the Company's retail stores, systems related
to demand and supply planning, and inventory control;  interruptions in data and
communications  systems;  fluctuations  and difficulty in forecasting  operating
results;  the ability of the Company to sustain,  manage or forecast  its growth
and  inventories;  the  size,  timing  and  mix of  purchases  of the  Company's
products;  the  underperformance or delay of new products;  the ability
<PAGE>


PART I -FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

to  secure  and  protect  trademarks,  patents  and other intellectual property;
performance  and  reliability  of  our  products;   customer  service;   adverse
publicity;  the loss of significant  suppliers or customers,  such as department
stores and specialty  retailers;  the  consolidation  or  restructuring  of such
customers,  including large  department  stores,  which may result in unexpected
store closings; our reliance on independent manufacturers in China and potential
disruptions  in  such  manufacturing  caused  by  political   instability,   the
occurrence  of a natural  disaster  or other  disruptions  in China's  social or
economic  structure;  the impact of changes in the value of foreign  currencies,
including  the Chinese Yuan and the  currencies  of countries  where Stride Rite
markets its various  brands;  the  ability to secure raw  materials;  delays and
increased costs of freight and  transportation to meet delivery  deadlines;  the
impact on product development or manufacturing as a result of health risks; acts
of terrorism;  changes in business strategy or development plans;  general risks
associated  with doing business  outside the United States,  including,  without
limitation,   import  duties,   tariffs,   quotas  and  political  and  economic
instability;  changes in  government  regulations;  liability  and other  claims
asserted  against the Company;  the ability to attract and retain  qualified key
personnel;  and other factors  referenced or  incorporated  by reference in this
report and other reports.

     The risks  included  here are not  exhaustive.  Other  sections,  including
without limitation the section entitled "Risk Factors",  of our annual report on
Form 10-K may  include  additional  factors  which  could  adversely  affect the
Company's business and financial performance.  Moreover, the Company operates in
a very  competitive and rapidly  changing  environment.  New risk factors emerge
from time to time and it is not possible for management to predict all such risk
factors,  nor can it assess the impact of all such risk factors on the Company's
business or the extent to which any factor, or combination of factors, may cause
actual results to differ materially from those contained in any  forward-looking
statements.  Given these  risks and  uncertainties,  investors  should not place
undue reliance on forward-looking statements as a prediction of actual results.

     Investors should also be aware that while the Company does communicate with
securities  analysts  from time to time, it is against our policy to disclose to
them any non-public or confidential information.  Accordingly,  investors should
not assume  that we agree with any  statement  or report  issued by any  analyst
irrespective of the content of the statement or report. Furthermore, the Company
has a policy against  issuing or confirming  financial  forecasts or projections
issued by others.  Therefore,  to the extent that reports  issued by  securities
analysts  contain any projections,  forecasts or opinions,  such reports are not
the responsibility of the Company.

Critical Accounting Policies and Estimates
------------------------------------------

     The  preparation  of  financial   statements  and  related  disclosures  in
conformity with accounting principles generally accepted in the United States of
America  requires  management to make judgments,  assumptions and estimates that
affect  the  amounts  reported.  Please  refer  to the  discussion  of  critical
accounting  policies and estimates in the Company's  Annual Report on Form 10--K
for the fiscal year ended December 1, 2006 for additional information. There

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

have  been  no  changes  to  the Company's critical  accounting  policies in the
quarter ended March 2,2007.

Contingencies
-------------

     The sale of Tommy Hilfiger branded footwear is a significant portion of our
business.  The Tommy  Hilfiger  footwear  sales are  contingent on our licensing
agreement with Tommy Hilfiger Licensing, Inc. During fiscal 2006, we renewed the
agreement  for an  additional  one-year  term,  to March 2008.  During the first
quarter of fiscal 2007, we subsequently  entered into an additional extension of
the term of the  agreement  to December  2008.  Whether  our license  with Tommy
Hilfiger  will  remain in effect  depends,  in part,  on our  achieving  certain
minimum  sales levels for the licensed  products.  We expect to continue to meet
the minimum  sales  levels  required by the Tommy  Hilfiger  license  agreement.
During  2006,  the  parent  company of Tommy  Hilfiger  Licensing,  Inc.,  Tommy
Hilfiger  Corp.,  was  sold to Apax  Partners.  If we lose  the  Tommy  Hilfiger
license,  our business  would be  materially  and adversely  affected.  Revenues
derived from our Tommy  Hilfiger  licenses  are  included in the Tommy  Hilfiger
Footwear segment, the Other Wholesale footwear segment  (specifically the Stride
Rite  International  division),  Stride Rite Children's Group - Retail Division,
and the Stride Rite Children's Group - Wholesale Division.

Results of Operations
---------------------

     The following  table  summarizes  the Company's  performance  for the first
quarter of fiscal  2007 as compared to the results for the same period in fiscal
2006:

<TABLE>
Increase Percentage vs. 2006 Results:
------------------------------------
<CAPTION>
                                                                First Quarter
                                                                -------------

<S>                                                                 <C>
Net sales                                                            6.1%
Gross profit                                                         8.5%
Selling and administrative expenses                                  3.2%
Operating income                                                    30.5%
Income before income taxes                                          30.7%
Net income                                                          33.9%
</TABLE>


<TABLE>
Operating Ratios as a Percentage of Net Sales:
<CAPTION>
                                                      First Quarter
                                             --------------------------------
                                                 2007              2006
                                             --------------    --------------

<S>                                              <C>               <C>
Gross profit                                     40.8%             39.9%
Selling and administrative expenses              31.2%             32.1%
Operating income                                  9.6%              7.8%
Income before income taxes                        9.1%              7.4%
Net income                                        5.7%              4.5%
</TABLE>

<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

Net Sales

<TABLE>
      The first quarter breakdown of net sales is as follows:

<CAPTION>
                                                               Percentage
                                                                 Change
                                                                2007 vs.
                                            2007      2006        2006
                                           --------  --------  ------------
(In millions, except percentages)
<S>                                          <C>       <C>          <C>
Stride Rite Children's Group - Wholesale     $21.0     $21.2         (0.8)%
Stride Rite Children's Group - Retail         43.1      37.9         13.7%
                                           --------  --------  ------------
Stride Rite Children's Group                  64.1      59.1          8.5%

Keds                                          38.1      42.0         (9.3)%
Sperry Top-Sider                              26.0      23.6         10.3%
Stride Rite International                     23.3      22.8          2.1%
Saucony                                       22.4      21.1          6.3%
Hind                                           2.4       3.5        (30.8)%
                                           --------  --------  ------------
Other Wholesale Footwear                     112.2     113.0         (0.6)%

Tommy Hilfiger Footwear                       15.5      14.9          3.6%

Robeez                                         7.1      -              n/a

Elimination of intercompany sales            (4.2)     (3.6)           n/a
                                           --------  --------  ------------

Total net sales                             $194.7    $183.4          6.1%
                                           ========  ========  ============
</TABLE>

     During the first quarter of fiscal 2007,  consolidated  net sales increased
$11.3 million to $194.7  million,  or 6.1% above the sales level achieved in the
first quarter of fiscal 2006. The increase in sales is primarily  related to the
inclusion  of a full  quarter of Robeez  sales as well as the increase in Stride
Rite  Children's  Group - Retail's  sales.  Wholesale net sales  increased  $5.2
million  or 3.6% for the  first  quarter  of 2007,  and  overall  retail  sales,
including the e-commerce sites, increased $6.1 million or 15.7% when compared to
the same period in the prior year.  Unit shipments of first quality  merchandise
for the  wholesale  brands  during the first  quarter  were 1.4% higher than the
comparable period in 2006.

     First quality wholesale net sales increased by $2.9 million,  or 2.0% above
the wholesale net sales level achieved in the first quarter of fiscal 2006. This
includes the positive impact of a $1.0 million  decrease in combined  discounts,
returns and allowances.  Sales of closeout products  increased $1.3 million from
the  comparable  period in the 2006 fiscal year.  Additionally,  royalty  income
increased $0.6 million versus the comparable period in the 2006 fiscal year.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

Gross Profit
------------

     During the first  quarter of fiscal  2007,  the  Company's  gross profit of
$79.5 million  increased $6.3 million or 8.5% above the amount  recorded  during
fiscal 2006's first  quarter.  The gross profit  percentage  rate for the fiscal
2007 first quarter  increased 0.9 percentage  points to 40.8%,  versus the 39.9%
rate reported in the prior year's first  quarter.  Contributing  to the improved
gross profit  dollars were the full quarter impact of Robeez gross sales in 2007
and  increased  sales of higher  priced  Sperry  Top-Sider  products  in premier
department store and independent retail channels.  Offsetting a portion of these
increases  were the lower gross  profit  dollars  caused by the declines in Keds
sales,  an increase  in  promotional  event sales in the Stride Rite  Children's
Group retail stores, and a shift in product mix. The gross profit comparison was
also impacted by the $2.6 million pre-tax expense  recorded in the first quarter
of the prior year which  related to the flow through of the  remaining  purchase
accounting  inventory  write-up  to fair value  recorded  as part of the Saucony
acquisition.

Operating Costs
---------------

     During  the  first  quarter  of fiscal  2007,  selling  and  administrative
expenses were $60.8 million,  an increase of $1.9 million or 3.2% as compared to
the first quarter of fiscal 2006.  This increase was  principally  the result of
the  inclusion of Robeez which added $3.3  million in operating  expenses.  Also
contributing  to the higher  expense  levels in the first quarter of fiscal 2007
were $2.1 million in incremental  costs  associated with the increased number of
Stride Rite Children's  Group retail stores,  which includes  Saucony's  factory
outlet stores in addition to increased  investment in European  operations which
added $0.8 million in expenses during the quarter. Offsetting a portion of these
expense  increases  were $0.8  million in  reduced  pension  expense  due to the
previously  announced changes in our defined benefit plan that included stopping
the accrual of future  retirement  benefits and preserving earned benefits as of
December 31, 2006. In addition,  first quarter  acquisition  related integration
costs of $0.3 million for Robeez in fiscal 2007 were $0.9 million lower than the
integration  expenses  in the prior  year's  comparable  period  related  to the
acquisition of Saucony. As a percentage of sales,  operating costs were 31.2% in
the first  quarter  of fiscal  2007  compared  to 32.1% in the first  quarter of
fiscal 2006.

Other Income and Taxes
----------------------

     Investment  income related to the Company's cash equivalents and marketable
securities was $0.4 million in the first quarter of fiscal 2007,  which remained
flat versus the similar period in fiscal 2006.  Interest expense,  which relates
to borrowings under the revolving credit agreement, increased by $0.3 million in
the first  quarter of fiscal  2007 as  compared  to the first  quarter of fiscal
2006.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

     The provision for income taxes  increased $1.3 million in the first quarter
of fiscal 2007 as compared to the similar  period in fiscal 2006.  This increase
was due to the higher pre-tax income amount, offset in part by a lower tax rate.
Our effective tax rate was 37.1% in the first quarter of fiscal 2007 as compared
to 38.6% in the first quarter of fiscal 2006.

Net Income
----------

     Net  income  for the first  quarter of fiscal  2007 was $11.1  million,  an
increase of $2.8  million,  or 33.9% as compared to the same period in the prior
year.  The  higher  net sales and  resulting  gross  profit,  due in part to the
addition of Robeez,  were able to offset  corresponding  increases  in operating
expenses and interest expense.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

Segments Review
---------------

     In September  2006, the Company  completed its acquisition of three holding
companies that, together with their direct and indirect subsidiaries, constitute
the Robeez Group  ("Robeez")  pursuant to a Share  Purchase  Agreement.  At that
time, Robeez became our wholly-owned  subsidiary.  Robeez' results of operations
have been included in our results since the date of acquisition. Robeez has been
reported as a separate segment based on management's  evaluation of the business
for the purposes of assessing performance and allocating resources.

Stride Rite Children's Group - Retail
-------------------------------------

     The net sales of the Stride Rite Children's  Group - Retail  increased $5.2
million or 13.7% in the first  quarter as  compared  to the same  quarter in the
prior year. Sales at comparable  Children's Group retail stores (stores open for
52 weeks in each fiscal year)  increased  6.3% for the first  fiscal  quarter of
2007. The increase in the comparable stores category was partially  attributable
to the shift of the annual pre-Easter  holiday  promotional event into the first
quarter of fiscal 2007, as compared to the second quarter of fiscal 2006. At the
end of the first  quarter of fiscal  2007,  the Stride Rite  Children's  Group -
Retail operated 307 Stride Rite  children's  shoe stores and outlets.  This is a
net  increase of 27 stores,  or 10% from the end of the same period in the prior
year. In addition Stride Rite Children's Group-Retail operated 15 Saucony outlet
stores. Current plans for fiscal 2007 include the opening of 27 Children's Group
retail stores and the closing of 13 underperforming retail locations.

     The Stride Rite Children's Group - Retail operating income decreased due to
a lower gross profit  percentage and higher operating  expenses which offset the
income  impact of higher  sales versus the prior year.  The gross profit  margin
decline was  primarily the result of a high level of  promotional  events in our
retail stores and a lower gross profit dollar product mix. The operating expense
increase is  primarily  related to the  additional  number of stores and certain
increased indirect store costs.

Stride Rite Children's Group - Wholesale
----------------------------------------

     Net sales  decreased  $0.2 million or 0.8% during the first quarter of 2007
as compared to the same quarter last year.  This slight  decrease was  primarily
attributable  to lower sales of first  quality  products to  department  stores,
mainly  in the  Stride  Rite and  Tommy  Hilfiger  product  lines,  as well as a
decrease in closeout products sales. Offsetting these declines were higher sales
of Sperry Top-Sider and Saucony children's products.

     The Stride Rite  Children's  Group - Wholesale  operating  income  declined
slightly versus the prior year. The decline was primarily  related to the impact
of the lower net sales and the  corresponding  reduction in gross profit dollars
due to a shift in product mix,  being  largely  offset by decreases in operating
expenses.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
            RESULTS OF OPERATIONS

Other Wholesale Footwear
------------------------

     The slight overall  decrease in net sales of the Other  Wholesale  Footwear
segment was primarily  attributable to decreases in Keds and Hind product sales.
These  decreases  were  partially  offset by  increases  in  Saucony  and Sperry
Top-Sider product sales.

     During the first quarter of fiscal 2007,  the increase in Saucony  domestic
sales was driven by strong sales of several new technical  and athletic  product
introductions.  Offsetting  a  portion  of this was a  decrease  in  promotional
product sales.

     The Sperry  Top-Sider  sales increase was  attributable  to strong sales of
both men's and women's product lines. The growth in the Sperry Top-Sider product
sales in the first  quarter  resulted from  increases in the premier  department
store and independent retail channels. Offsetting a portion of this sales growth
was a decrease in promotional product sales.

     The Stride  Rite  International  division's  net sales  growth in the first
quarter  of fiscal  2007 was  primarily  the  result of strong  sales of Saucony
products in Europe,  Keds sales  increases in Canada,  Europe and  Australia and
Sperry Top-Sider's sales in Europe, Asia and Latin America. Offsetting a portion
of this increase were lower Tommy Hilfiger sales in Canada and Latin America.

     The Keds sales  decline  during the first quarter of fiscal 2007 versus the
same period last year was partially  attributable  to a decrease in core product
sales in the mid-tier and value channels,  as well as lower children's sales. We
have continued to add new distribution in the younger-oriented  specialty stores
and premier  department  stores.  These updated product offerings have performed
well in these channels.

     The Hind sales  decline  was  primarily  related to sales  declines  in the
outdoor  channel.  We expect this trend to continue  through  the  remainder  of
fiscal 2007 as we reposition  the technical  apparel  strategy and introduce new
product offerings.

     The  increased  operating  income versus the prior year in this segment was
primarily  related  to the  impact of higher  net sales in  Saucony  and  Sperry
Top-Sider  and  the  corresponding  increases  in  gross  profit  dollars.  Also
contributing to the favorable  operating  income  comparison is the $2.6 million
expense  recorded  in last  year's  first  quarter  for the flow  through of the
remaining  purchase  accounting  write-up of acquired Saucony  inventory to fair
value. Offsetting these increases were the impact of lower net sales in Keds and
Hind and the corresponding decreases in gross profit dollars.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL CONDITION  AND
            RESULTS OF OPERATIONS

Tommy Hilfiger Footwear, Inc.
-----------------------------

     The net sales of Tommy Hilfiger  footwear adult products  increased by 3.6%
during the first  quarter of fiscal 2007.  This was  primarily  attributable  to
positive  trends in both  women's and men's  product  lines sales to family shoe
store  accounts.  In fiscal  2007,  under this  license,  we are  projecting  an
improved sales trend, although still an overall sales decline.

     The  Tommy  Hilfiger  operating  income  increase  versus  prior  year  was
primarily  related  to the  impact  of higher  net  sales and the  corresponding
increase in gross profit dollars coupled with decreases in operating expenses.

Robeez
------

     The first  quarter of fiscal 2007 was the first  complete  quarter in which
Robeez'  results of operations  were included in the Company's  results.  Robeez
sales  for the first  quarter  of fiscal  2007 were $7.1  million.  Net sales of
Robeez products met the Company's expectations on the strength of its soft-soled
products for infants and children to age four.

     Robeez'  operating income of $398 thousand for the quarter related to gross
profit dollars generated from sales less operating expenses.

Liquidity and Capital Resources
-------------------------------

     At the end of the first fiscal quarter of 2007, our balance sheet reflected
a current ratio of 4.1 to 1.0 with $98.5 million in long-term  debt. Last year's
first  quarter  balance  sheet  reflected a current ratio of 4.3 to 1.0 with $95
million in long-term debt. Our cash and cash  equivalents  totaled $20.0 million
at March 2,  2007,  a  decrease  of $3.2  million  from the total  cash and cash
equivalents of $23.2 million at the end of the first quarter of fiscal 2006. The
decrease  in our cash  balance,  versus the  comparable  quarter  last year,  is
primarily  attributable to funding a portion of the Robeez acquisition which was
completed in September 2006.

     The Company's seasonal cash flow patterns typically require the use of cash
during the first  quarter of a fiscal year.  During the first  quarter of fiscal
2007,  the  Company  used  $38.9  million of cash to fund  operations  which was
consistent  with the $41.0 million used to fund  operations in the first quarter
of fiscal 2006.  Inventory levels at the end of the first quarter of fiscal 2007
increased  $11.1  million,  or 9.6% from the levels  recorded  at the end of the
prior year's first quarter.  The increase in inventory  related primarily to the
addition of Robeez product and the timing of certain product receipts.  Accounts
receivable  at March 2, 2007 were $128.7  million or 6.3% higher than the amount
at the end of last year's first quarter which was largely due to the addition of
Robeez and higher  sales in the last  month of the  fiscal  quarter.  Days sales
outstanding  ("DSO"),  which  measures the length of the  collection  period for
accounts receivable for sales during the quarter,  was 56 days at the end of the
first fiscal quarter of 2007 which was consistent with the DSO at the end of the
same  period last year.  Accounts  payable,  at the end of the first  quarter of
fiscal 2007, increased $4.2
<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 2.     MANAGEMENT'S  DISCUSSION  AND ANALYSIS OF FINANCIAL  CONDITION AND
            RESULTS OF OPERATIONS

million  from  the  level  recorded  at  the  end  of  the  prior  year's  first
quarter.  The increase was  primarily  due to the higher  inventory  balance and
addition of Robeez. During the first fiscal quarter of 2007, the Company did not
contribute to its defined  benefit  pension plan and, at this time,  the Company
does not plan to make any  contributions  to its defined  benefit  pension  plan
during the remainder of the 2007 fiscal year.

     Additions  to property  and  equipment  totaled  $3.3  million in the first
fiscal  quarter of 2007, a decrease  versus the $3.9 million in the first fiscal
quarter of 2006.  The  decrease  primarily  related to a higher level of capital
expenditures  in the first  quarter  of fiscal  2006 for the  renovation  of our
corporate  headquarters.  The  capital  purchases  in the first  quarter of 2007
related  primarily to the Company's  continued retail expansion  efforts,  a new
brand trade show booth and improvements  within our warehousing and distribution
facilities. Funding of our capital expenditures was provided from operations and
our revolving credit facility.

     At the end of the first  quarter of fiscal  2007,  there was $98.5  million
outstanding  under the  Company's  revolving  credit  facility.  The increase in
outstanding  debt  during  the first  quarter  of fiscal  2007 was the result of
normal seasonal working capital  requirements.  The facility was entered into in
September 2005 as part of the Saucony  acquisition and also to provide funds for
working capital and general corporate purposes.  As of March 2, 2007, letters of
credit totaling $34.5 million were  outstanding for the purchase of inventories.
The use of  letters  of credit  for  inventory  purchases  does not  impact  the
Company's  borrowing  capacity  under the revolving line of credit because these
letters  of credit  are  supported  by other  uncommitted  lines of  credit  and
permitted by the terms of the revolving credit agreement.  All letters of credit
generally expire within one year.

     During  the first  quarter  of fiscal  2006 we  returned  $2.2  million  to
shareholders through cash dividends.  Effective with the March 15, 2007 dividend
payment,  the Company's Board of Directors increased the quarterly dividend rate
from $0.06 per share to $0.07 per share.  This will result in an annual increase
in dividend payments to shareholders of approximately  $1.5 million.  We did not
repurchase any common shares under our share repurchase program during the first
quarter.  As of March 2, 2007 we have approximately 3.0 million shares remaining
on our share repurchase authorization approved by the Board of Directors in June
2004.

     We do not have any relationships with unconsolidated  entities or financial
partnerships,  such as  entities  often  referred  to as  structured  finance or
special purpose  entities,  which would have been established for the purpose of
facilitating  off-balance-sheet  arrangements or other  contractually  narrow or
limited  purposes.  As such,  we are not  exposed to any  financing,  liquidity,
market or credit risk that could arise if we had engaged in such relationships.



<PAGE>



PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

ITEM 3.     QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     There  have  been no  material  changes  from  the  information  previously
reported  under  Item 7A of the  Company's  Annual  Report  on Form 10-K for the
fiscal year ended December 1, 2006.

ITEM 4.     CONTROLS AND PROCEDURES

(a) Evaluation of disclosure controls and procedures.

     Within the 90 days prior to the date of this  report,  the Company  carried
out an evaluation  under the  supervision of and with the  participation  of the
Company's management, including the participation of its Chief Executive Officer
and Chief Financial Officer, of the effectiveness of the design and operation of
the Company's  disclosure controls and procedures pursuant to Rule 13a-15 of the
Securities Exchange Act of 1934, as amended.  Based upon that evaluation,  as of
the end of the period covered by this report,  our Chief  Executive  Officer and
Chief  Financial  Officer  have  concluded  that  our  disclosure  controls  and
procedures  (as  defined in Rules  13a-15(e)  and  15d-15(e)  of the  Securities
Exchange  Act of 1934,  as amended)  are  effective  to ensure that  information
required  to be  disclosed  by the  Company in reports  that it files or submits
under the Securities Exchange Act of 1934, as amended,  is recorded,  processed,
summarized  and reported  within the time periods  specified in  Securities  and
Exchange  Commission  rules and forms.  We continue to review and  document  our
disclosure  controls and procedures and may from time to time make changes aimed
at enhancing their  effectiveness  and ensuring that our systems evolve with our
business.

(b) Changes in internal controls over financial reporting.

     There  was no change  in the  Company's  internal  control  over  financial
reporting  (as  defined  in Rules  13a-15(f)  and  15d-15(f)  of the  Securities
Exchange Act of 1934, as amended)  during our first quarter that has  materially
affected,  or is reasonably  likely to materially  affect,  our internal control
over financial  reporting.  As disclosed in our Annual Report on Form 10-K filed
with the Securities and Exchange Commission, we have included Robeez Footwear in
our  review  and  evaluation  of  internal  controls  and  procedures  as of the
beginning of fiscal 2007.


<PAGE>


PART II - OTHER INFORMATION

ITEM 2.  UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

     The Company did not repurchase  equity  securities during the first quarter
of  fiscal  2007.  There is a maximum  of  2,998,994  shares  that may yet to be
purchased under the program as of March 2, 2007.

     In June 2004, the Board of Directors  increased the authorization  under an
existing  stock   repurchase   program  by  five  million   shares.   Under  the
authorization,  the Company can repurchase  shares in the open market or through
privately  negotiated  transactions.  The  repurchase  program  does not have an
expiration date. All shares repurchased during the period covered by this report
were purchased under a publicly announced plan.



<PAGE>


PART II - OTHER INFORMATION (continued)

                           THE STRIDE RITE CORPORATION

ITEM 6.     EXHIBITS

Exhibit No.       Description of Exhibit
-----------       ----------------------

    2      (i)    Share Purchase Agreement between Sandra Wilson, Greg Garrett,
                  Lorne Fingarson, The Wilson Family Trust NO. 1, the Garret
                  Family Trust NO. 1, The Fingarson Family Trust NO. 1, 0740613
                  B.C.LTD. And 0753831 B.C. LTD. and The Stride Rite
                  Corporation and Stride Rite Canada Limited dated as of
                  September 5, 2006.  This document was filed as Exhibit 2.1 to
                  the Registrant's Form 8-K on September 12, 2006 and is
                  incorporated herein by reference.

    3             (i) Restated Articles of Organization of the Registrant with
                  amendments thereto through November 28, 1986, incorporated by
                  reference from Exhibit 4(i) to the Registrant's Form S-8 filed
                  on October 25, 1996.

    3             (ii) Articles of Amendment dated April 7, 1987 to Restated
                  Articles of Organization, incorporated by reference from
                  Exhibit 4(i) to the Registrant's Form S-8 filed on October 25,
                  1996.

    3             (iii) Articles of Amendment dated December 16, 1987 to
                  Restated Articles of Organization of the Registrant,
                  incorporated by reference from Exhibit 4(i) to the
                  Registrant's Form S-8 filed on October 25, 1996.

    3             (iv) Articles of Amendment dated December 3, 1991 to the
                  Restated Articles of Organization of the Registrant,
                  incorporated by reference from Exhibit 4(i) to the
                  Registrant's Form S-8 filed on October 25, 1996.

    3             (v) Certificate of Vote of Directors establishing a series of
                  a Class of Stock dated as of June 18, 1997.

    3             (vi) By-laws of the Registrant, as amended. This document was
                  filed as Exhibit 3 of the Registrant's Form 10-Q for the
                  fiscal period ended June 1, 1990 and is incorporated herein by
                  reference.

    4             (i) Reference is made to Exhibits 3(i), (ii), (iii) and (iv)
                  referred to above, which are expressly incorporated herein by
                  reference.

    10     (i)*   Sixth Amendment to the Amended and Restated License Agreement
                  between Registrant and Tommy Hilfiger Licensing, Inc.

  31.1*           Certification of the Company's Chief Executive Officer
                  pursuant to Section 302 of the Sarbanes-Oxley Act of 2002

  31.2*           Certification of the Company's Chief Financial Officer
                  pursuant to Section 302 of the  Sarbanes-Oxley Act of 2002

  32.1*           Certification of the Company's Chief Executive Officer
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

  32.2*           Certification of the Company's Chief Financial Officer
                  pursuant to Section 906 of the Sarbanes-Oxley Act of 2002
*Filed herewith


<PAGE>



                           THE STRIDE RITE CORPORATION

                                   SIGNATURES



     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 duly authorized.

                                    THE STRIDE RITE CORPORATION
                                    ---------------------------
                                    (Registrant)



Date:  April 10, 2007               By:  /s/ Frank A. Caruso
                                    --------------------------
                                       Frank A. Caruso
                                       Chief Financial Officer