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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 August 27, 2004

( )   TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
            EXCHANGE ACT OF 1934 (NO FEE REQUIRED)

                  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.)

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

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


     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  report),  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 an accelerated filer (as
defined in Exchange Act Rule 12b-2).

          Yes(X)          No ( )
                                -
                      APPLICABLE ONLY TO CORPORATE ISSUERS

      Indicate the number of shares outstanding of each of the issuer's classes
of common stock, as of the latest practicable date.

As of October 5, 2004, 36,773,352 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


<CAPTION>
                                    August 27,                      August 29,
                                       2004         November 28,       2003
                                   (Unaudited)         2003         (Unaudited)
                                 ---------------   -------------- --------------
                                                  (In thousands)
  Assets

  Current Assets:
     Cash and cash
<S>                                  <C>             <C>              <C>
       equivalents                   $84,906         $103,272         $96,195

     Accounts and notes
       receivable, net                69,998           51,058          69,590

     Inventories                      80,604           81,925          68,557

     Deferred income taxes            15,167           14,393          20,222

     Other current assets             10,140           19,452           5,330
                                    --------         --------        --------

     Total current assets            260,815          270,100         259,894

  Property and equipment, net         56,874           60,802          62,552

  Other assets                        12,582           14,315          15,022
                                    --------         --------        --------

     Total assets                   $330,271         $345,217        $337,468
                                    ========         ========        ========
</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 BALANCE SHEETS (CONTINUED)

<CAPTION>
                                   August 27,                       August 29,
                                      2004        November 28,         2003
                                  (Unaudited)        2003           (Unaudited)
                                 -------------   --------------   -------------
                                     (In thousands, except for share data)
  Liabilities and Stockholders' Equity

  Current Liabilities:
<S>                                   <C>             <C>             <C>
     Accounts payable                 $17,450         $23,887         $10,132
     Income taxes payable              17,288          16,815          20,458
     Accrued expenses and other
       liabilities                     21,164          23,273          21,869
                                     --------        --------        --------
     Total current liabilities         55,902          63,975          52,459

  Deferred income taxes                   844             381             775
  Pension obligation                   13,145          13,145          11,677

  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 - 56,946,544      14,237          14,237          14,237

     Capital in excess of par
       value                           15,288          16,825          16,803

    Retained earnings                 435,890         415,988         418,914
    Accumulated other
        comprehensive loss             (7,796)         (7,798)         (6,961)
     Less cost of 19,999,131
        shares of common stock
        held in treasury
        (17,607,304 on November
        28, 2003 and 17,547,650
        on August 29, 2003)          (197,239)       (171,536)       (170,436)
                                     ---------       ---------       ---------
     Total stockholders' equity       260,380         267,716         272,557
                                     ---------       ---------       ---------

     Total liabilities and
       stockholders' equity          $330,271        $345,217        $337,468
                                     ========        ========        ========
</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 periods ended August 27, 2004 and August 29, 2003

<CAPTION>
                               Three Months Ended          Nine Months Ended
                               ------------------          -----------------
                                 (In thousands, except for per share data)
                            August 27,    August 29,   August 27,    August 29,
                               2004          2003         2004          2003
                           ------------  ------------ ------------  ------------
<S>                         <C>           <C>          <C>           <C>
Net sales                   $140,382      $139,747     $441,525      $446,355

Cost of sales                 89,197        87,111      273,825       274,700
                           ------------  ------------ ------------  ------------

Gross profit                  51,185        52,636      167,700       171,655

Selling and
  administrative
   expenses                   41,831        42,592      127,760       130,970
                           ------------  ------------ ------------  ------------

Operating income               9,354        10,044       39,940        40,685


Investment income                298           201        1,342         1,807
Interest expense                 (79)          (75)        (235)         (247)
Other expense, net               (85)          (43)        (233)         (207)
                           ------------  ------------ ------------  ------------
                                 134            83          874         1,353
                           ------------  ------------ ------------  ------------

Income before income
   taxes                       9,488        10,127       40,814        42,038

Provision for income
   taxes                       3,269         3,714       15,211        15,585
                           ------------  ------------ ------------  ------------

Net income                    $6,219        $6,413      $25,603       $26,453
                           ============  ============ ============  ============

Net income per common share:
   Diluted                    $  .16      $    .16     $    .65      $    .66
                           ============  ============ ============  ============
   Basic                      $  .17      $    .16     $    .66      $    .67
                           ============  ============ ============  ============

Dividends per common
   share                      $  .05      $    .05     $     .15     $    .15
                           ============  ============ ============  ============

Average common shares
   used in per share
     computations:
   Diluted                    38,159        40,243        39,311       39,992
                           ============  ============ ============  ============
   Basic                      37,467        39,456        38,508       39,415
                           ============  ============ ============  ============

</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 nine months ended August 27, 2004 and August 29, 2003

<CAPTION>
                                                        2004             2003
                                                   -------------   -------------
Cash flows from operating activities:                      (In thousands)
<S>                                                   <C>              <C>
   Net income                                         $25,603          $26,453
   Adjustments to reconcile net income to net
     cash provided from operations:
   Depreciation and amortization                        9,477           10,438
   Deferred income taxes                                 (311)             610
   Loss on sale of trading security                         -                6
   Gain related to long-term investments                    -           (1,071)
   Loss on disposals of property and equipment            219              555
   Changes in:
      Accounts and notes receivable                   (18,940)         (21,515)
      Inventories                                       1,321           29,656
      Other current assets                             10,312            9,030
      Other current liabilities                        (7,920)         (15,436)
      Other long-term assets                            1,733           (2,108)
   Contribution to pension plan                        (1,000)          (2,000)
                                                     ----------       ---------
      Net cash provided from operating activities      20,494           34,618
                                                     ----------       ---------

Cash flows from investing activities:
   Additions to property and equipment                 (5,768)          (5,254)
   Distributions from long-term investments                 -            1,071
                                                     ----------       ---------
      Net cash used in investing activities            (5,768)          (4,183)
                                                     ----------       ---------

Cash flows from financing activities:
   Proceeds from sale of stock under stock plans        3,981            2,342
   Cash dividends paid                                 (5,824)          (5,914)
   Repurchase of common stock                         (31,249)          (3,773)
                                                     ----------       ---------
      Net cash used in financing activities           (33,092)          (7,345)
                                                     ----------       ---------

Net (decrease) increase in cash and cash
     equivalents                                      (18,366)          23,090

Cash and cash equivalents at beginning of the
     period                                           103,272           73,105
                                                     ---------        ---------

Cash and cash equivalents at end of the period        $84,906          $96,195
                                                     =========        =========
</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 August 27, 2004 and August 29,
2003 is unaudited, however, such information includes all adjustments (including
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 August 27, 2004
and August 29, 2003 are not necessarily  indicative of the results of operations
that may be expected  for the  complete  fiscal  year.  The  year-end  condensed
consolidated  balance sheet data was derived from audited financial  statements,
but does not include all disclosures  required by generally accepted  accounting
principles.  The  Company  filed with the  Securities  and  Exchange  Commission
audited  consolidated  financial statements for the year ended November 28, 2003
on Form 10-K,  which included all information  and footnotes  necessary for such
presentation.

     The  Company's   preparation  of  the  condensed   consolidated   financial
statements in conformity with generally accepted accounting  principles 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  and income  taxes;  assumptions  related  to the  defined
benefit  pension  plan;  and  estimates  of future  undiscounted  cash  flows on
property and equipment  that may be impaired.  Actual  results could differ from
those estimates.




<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

                    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 1 - Summary of Significant Accounting Policies - (continued)

Stock Purchase and Option Plans

     At August 27, 2004, the Company had three  stock-based  compensation  plans
which  are  described  more  fully  in  Note  10 to the  Company's  consolidated
financial statements for the fiscal year ended November 28, 2003 as contained on
Form 10-K.  The  Company  accounts  for these plans  under the  recognition  and
measurement  principles of APB Opinion No. 25,  "Accounting  for Stock Issued to
Employees", and related interpretations. The following table provides the effect
on net income and earnings  per share if the Company had applied the  fair-value
recognition provisions of SFAS No. 148, "Accounting for Stock Based Compensation
- Transition and Disclosure", to stock-based compensation.

<TABLE>
                               Three Months Ended          Nine Months Ended

<CAPTION>
                            August 27,    August 29,    August 27,   August 29,
                               2004          2003          2004         2003
                           ------------  ------------  ------------ ------------
                                 (In thousands, except for per share data)
<S>                            <C>           <C>         <C>          <C>
Net income, as reported        $6,219        $6,413      $25,603      $26,453

Add:  Stock based employee
compensation expense
included in net income,
net of related tax effects
                                    3            21            9           30

Deduct:  Total stock based
employee compensation
expense determined under
fair value based method
for all awards, net of
related tax effects
                                 (492)         (361)      (1,432)      (1,292)
                             ---------     ---------     --------     --------

Pro forma net income           $5,730        $6,073      $24,180      $25,191
                             =========     =========     ========     ========

Earnings per share:
   Basic - as reported        $   .17       $   .16      $   .66       $  .67
                             =========     =========     ========     ========
   Basic - pro forma          $   .15       $   .15      $   .63       $  .64
                             =========     =========     ========     ========

   Diluted - as reported      $   .16       $   .16      $   .65       $  .66
                             =========     =========     ========     ========
   Diluted - pro forma        $   .15       $   .15      $   .62       $  .63
                             =========     =========     ========     ========
</TABLE>


<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 for the period.  Diluted earnings per common
share  reflects  the  potential  dilution  that could  occur if options to issue
common stock were 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      Nine Months Ended

<CAPTION>
                                    Aug. 27,     Aug. 29,   Aug. 27,    Aug. 29,
                                      2004         2003       2004        2003
                                    ---------   ---------  ---------  ----------
                                     (In thousands, except for per share data)
<S>                                    <C>         <C>       <C>         <C>
Net income                            $6,219      $6,413    $25,603     $26,453

Calculation of shares:
Weighted average common shares
  outstanding (basic)                 37,467      39,456     38,508      39,415

Dilutive effect of stock options         692         787        803         577
                                      ------      ------     ------      ------

Weighted average common shares
  outstanding (diluted)               38,159      40,243     39,311      39,992
                                      ======      ======     ======      ======

Net income per common share
(basic)                                 $.17        $.16       $.66        $.67
                                      ======      ======     ======      ======

Net income per common share
(diluted)                               $.16        $.16       $.65        $.66
                                      ======      ======     ======      ======
</TABLE>


     The  following  options  were not  included in the  computation  of diluted
earnings per share  because the options'  exercise  prices were greater than the
average market price of the common shares:

                                                                 First Nine
                                          Third Quarter             Months
                                        -------------------  ------------------
                                           2004      2003      2004      2003
                                        --------  ---------  --------  --------
                                                    (In thousands)
Options to purchase shares of common
  stock                                   1,130        507     1,043       540



<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       Nine Months Ended
                                  ----------------------  ----------------------
                                   Aug. 27,     Aug. 29,   Aug. 27,    Aug, 29,
                                     2004         2003       2004        2003
                                  ----------   ---------- ----------  ----------
                                                  (In thousands)
<S>                                <C>         <C>        <C>           <C>
Net income                         $6,219      $6,413     $25,603       $26,453

Other comprehensive
  income(loss):
Foreign currency translation
  adjustments                         131        (191)          2           285
                                  ----------  ----------  ----------  ----------
Total comprehensive income         $6,350      $6,222     $25,605       $26,738
                                  ==========  ==========  ==========  ==========
</TABLE>


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

<CAPTION>
                                   August 27,      November 28,      August 29,
                                      2004             2003             2003
                                 -------------    --------------   -------------
                                                (In thousands)
Foreign currency  translation
<S>                                   <C>               <C>             <C>
   adjustments                        $(215)            $(217)          $(240)
Minimum pension liability
   adjustments, net of taxes         (7,581)           (7,581)         (6,721)
                                   ---------         ---------       ---------
Accumulated other
   comprehensive loss               $(7,796)          $(7,798)        $(6,961)
                                   =========         =========       =========

</TABLE>


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

                NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 4 - Intangible Assets and Goodwill

     The following table summarizes the Company's intangible assets and goodwill
balances:

<TABLE>
                               Intangible assets not subject to amortization
                               ------------------------------------------------
<CAPTION>
                                                  Trademark
                                  Goodwill         Rights           Total
-------------------------------------------------------------------------------
August 27, 2004                                (In thousands)
<S>                               <C>             <C>              <C>
  Gross carrying amount           $3,067          $2,980           $6,047
  Accumulated amortization       $(2,159)        $(1,290)         $(3,449)
November 28, 2003
  Gross carrying amount           $3,068          $2,980           $6,048
  Accumulated amortization       $(2,160)        $(1,290)         $(3,450)
August 29, 2003
  Gross carrying amount           $3,073          $2,980           $6,053
  Accumulated amortization       $(2,165)        $(1,290)         $(3,455)
</TABLE>


Note 5 - Benefit Plans

     During the first  quarter of fiscal 2004,  the Company  adopted the interim
disclosure  provisions of SFAS No. 132 (revised  2003),  "Employers'  Disclosure
about  Pensions  and  Other  Postretirement   Benefits,  an  Amendment  of  FASB
Statements  No. 87, 88 and 106 and a Revision of FASB  Statement  No. 132." This
statement  revises  employers'  disclosures  about  pension plans and other post
retirement benefit plans.

     The following table  summarizes the components of net periodic benefit cost
for the Company:

<TABLE>
                                  Three Months Ended        Nine Months Ended
                              ------------------------  -----------------------
<CAPTION>
                               Aug. 27,      Aug. 29,    Aug. 27,     Aug. 29,
                                 2004          2003        2004         2003
                              -----------  -----------  ----------  -----------
                                               (In thousands)
<S>                                <C>           <C>       <C>           <C>
Service cost                       $431          $303      $1,282        $909
Interest cost                       886           763       2,692       2,289
Expected return on assets          (994)         (704)     (2,989)     (2,112)
Net loss recognized                 428           322       1,156         966
Amortization of prior service
   cost                               7             6          17          18
                              -----------  -----------  ----------  -----------
Net periodic benefit cost          $758          $690      $2,158      $2,070
                              ===========  ===========  ==========  ===========
</TABLE>

     During the first  quarter of fiscal  2004,  the  Company  contributed  $1.0
million to its defined benefit pension plan. The Company does not intend to make
any further contributions to its defined benefit pension plan during fiscal year
2004.  During the third quarter of fiscal 2003,  $2.0 million was contributed to
the Company's defined benefit pension plan.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

                    NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

Note 6 - 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 2003, we negotiated
the renewal of the agreement  for an additional  term. In early January 2004, we
finalized the terms of the license  agreement,  which will expire in March 2007.
We expect to meet our obligations under the Tommy Hilfiger license agreement and
accordingly,  we believe  that no  provision  is  currently  required  for costs
related to the  potential  loss of this license.  If we lose the Tommy  Hilfiger
license, our business would be materially and adversely affected.


<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: 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 possible failure to
retain the Tommy Hilfiger  footwear  license;  the ability to secure and protect
trademarks, patents and other intellectual property; performance and reliability
of  products;  customer  service;  adverse  publicity;  the loss of  significant
suppliers or customers, such as department stores and specialty retailers, the


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

consolidation or restructuring of such customers, including large chain and
department stores, which may result in unexpected store closings;  dependence on
China manufacturing;  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;  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;  acts of war or
terrorism;  labor  disputes;  changes in government  regulations;  liability and
other claims  asserted  against the  Company;  the ability to attract and retain
qualified  personnel;  and other factors referenced or incorporated by reference
in this report and other reports.

     The risks included here are not  exhaustive.  Other sections of this report
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 material  non-public  information  or other  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.

     The Company  discussed a number of significant  trends and specific factors
affecting  the footwear  industry in general and our business in  particular  in
"Management's  Discussion  and  Analysis of Financial  Condition  and Results of
Operations",  Item 7 of our Annual Report on Form 10-K for the fiscal year 2003.
Those trends and factors  continue to be relevant to the  Company's  performance
and financial condition.

Critical Accounting Estimates
-----------------------------

     The  preparation  of the condensed  consolidated  financial  statements and
related disclosures in conformity with accounting  principles generally accepted
in the United States  requires  management to make  judgments,  assumptions  and
estimates  that affect the amounts  reported.  Please refer to the discussion of
critical  accounting  estimates in the Company's Annual Report on Form 10--K for
the fiscal year ended November 28, 2003 for additional information.

<PAGE>

PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

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 2003, we negotiated
the renewal of the agreement  for an additional  term. In early January 2004, we
finalized the terms of the license  agreement,  which will expire in March 2007.
We expect to meet our obligations under the Tommy Hilfiger license agreement and
accordingly,  we believe  that no  provision  is  currently  required  for costs
related to the  potential  loss of this license.  If we lose the Tommy  Hilfiger
license, our business would be materially and adversely affected.

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

     The following  table  summarizes  the Company's  performance  for the third
quarter  and first nine months of fiscal 2004 as compared to the results for the
same periods in fiscal 2003:

<TABLE>
Increase (Decrease) Percent vs. 2003 Results:
---------------------------------------------

<CAPTION>
                                            Third Quarter      Nine Months
                                            -------------      -----------

<S>                                              <C>              <C>
Net sales                                        0.5%             (1.1)%
Gross profit                                    (2.8)%            (2.3)%
Selling and administrative expenses             (1.8)%            (2.5)%
Operating income                                (6.9)%            (1.8)%
Income before income taxes                      (6.3)%            (2.9)%
Net income                                      (3.0)%            (3.2)%
</TABLE>


<TABLE>
Operating Ratios as a Percent of Net Sales:

<CAPTION>
                                         Third Quarter       Nine Months
                                       -----------------  -------------------
                                          2004    2003       2004     2003
                                       --------  -------  --------- ---------

<S>                                       <C>       <C>      <C>       <C>
Gross profit                              36.5%     37.7%    38.0%     38.5%
Selling and administrative expenses       29.8%     30.5%    28.9%     29.3%
Operating income                           6.7%      7.2%     9.0%      9.1%
Income before income taxes                 6.8%      7.2%     9.2%      9.4%
Net income                                 4.4%      4.6%     5.8%      5.9%
</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

Third Quarter 2004 Compared to Third Quarter 2003
-------------------------------------------------

Net Sales
---------

<TABLE>
The third quarter breakdown of net sales is as follows:
                                                                  Percent
                                                                  Change
                                                                 2004 vs.
<CAPTION>
                                             2004       2003       2003
                                           ---------  ---------  ----------
                                          (In millions, except percentages)
<S>                                         <C>        <C>         <C>
Stride Rite Children's Group - Wholesale    $30.9      $29.4       5.1%
Stride Rite Children's Group - Retail        40.3       38.5       4.5%
                                           ---------  ---------  ----------
Stride Rite Children's Group                 71.2       67.9       4.8%

Keds                                         27.6       30.6     (10.0)%
Tommy Hilfiger Footwear                      25.0       26.5      (5.5)%
Sperry Top-Sider                             11.8       11.4       3.8%
Stride Rite International                     7.7        6.5      17.8%
Elimination of intercompany sales            (2.9)      (3.2)       N/A
                                           ---------  ---------  ----------
Total net sales                            $140.4     $139.7       0.5%
                                           ======     ======     ======
</TABLE>

     During the third quarter of fiscal 2004,  consolidated  net sales increased
$0.7 million to $140.4  million,  or 0.5% above the sales level  achieved in the
third  quarter of fiscal 2003.  Wholesale  net revenues  decreased  1.3% for the
third quarter of 2004, while overall retail sales increased $1.9 million or 4.9%
when  compared to the same period in the prior year.  Unit  shipments of current
line  merchandise  for the wholesale  brands during the third quarter  decreased
5.0% when  compared with the same period in 2003.  The  Company's  average first
quality  wholesale  selling price increased 1.9% from the third quarter of 2003.
In addition,  closeout sales  decreased 11.4% during the third quarter of fiscal
2004 as compared to the prior year.  Royalty revenues at $1.7 million were 24.6%
higher in the third quarter of fiscal 2004 versus the same quarter last year.

     Net sales of the Stride Rite Children's  Group increased 4.8% for the third
quarter of fiscal 2004, compared to the same period of fiscal 2003. Sales of the
Children's  Group to  independent  retailers  increased  5.1%  during  the third
quarter of 2004 as compared to the same  quarter  last year.  This  increase was
primarily  attributable to increased sales of promotional and closeout  products
as well as fewer  returns  and  allowances.  Increased  sales of the  Children's
Group's  company-owned  retail stores,  which were up 4.5% from the same quarter
last  year  contributed  to the  overall  Stride  Rite  Children's  Group  sales
improvement. Sales at comparable Children's Group retail stores (stores open for
52 weeks in each fiscal year)  increased 1.3% during the third fiscal quarter of
2004.  The  third  quarter   company-owned  retail  store  sales  were  somewhat
negatively  impacted by the later Labor Day holiday this year. At the end of the
third  quarter of fiscal 2004,  the Stride Rite  Children's  Group  operated 243
stores. This is an increase of 13 stores, or 6% from the end of


<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  same  period in the  prior year.  Current  plans call  for the  opening of
approximately  17 retail stores and the closing of 4  underperforming  locations
during the 2004 fiscal year. During the third quarter of 2004 the Company opened
3 new stores and had no store closings.

     Keds sales  decreased in the third  quarter of fiscal 2004 due primarily to
decreased sales of closeouts and promotional products,  which is consistent with
our strategy to upgrade the brand's positioning. In addition,  Grasshopper sales
declined.  Partially  offsetting  these  declines were increases in sales of the
core  women's  and   children's   product   lines.   In   particular   both  the
Microstretch(TM)  and  Microstretch  Sport(TM)  basic  programs  continued to be
strong performers.

     The  decrease in sales of the Tommy  Hilfiger  Footwear  brand in the third
quarter  of fiscal  2004 was  primarily  attributable  to a decline in the men's
first quality business. Offsetting this decline was the introduction of both the
"H" Hilfiger and the Tommy Girl lines, as well as an increase in closeout sales.

     The  increase in the sales of Sperry  Top-Sider  products  during the third
quarter of the 2004 fiscal year was primarily  attributable  to the strong sales
of men's  performance boat shoes.  Sales declines in basic boat shoes and canvas
casual product  categories  along with a decrease in closeout sales in the third
quarter offset a portion of the gain.

     The Stride Rite  International  division had a 17.8%  increase in net sales
during the third  quarter of fiscal 2004 in comparison to the same period in the
prior year.  This sales  growth was  largely  the result of the  addition of new
distributors  in Asia and the Middle East as well as  continued  strong sales of
Tommy Hilfiger footwear in Asia and Latin America.



<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 third  quarter of fiscal  2004,  the  Company's  gross profit of
$51.2 million  decreased  $1.5 million or 2.8% below the amount  recorded in the
third  quarter  of 2003.  The  lower  level of  wholesale  sales  and  increased
inventory  obsolescence  costs contributed to the reduction in gross profit. The
gross profit rate in the third quarter of fiscal 2004  decreased 1.2  percentage
points to 36.5% as compared to the 37.7% rate achieved in the prior year's third
quarter. The reduction in gross profit percentage was primarily  attributable to
increased  discounted  product  sales,  certain higher product costs and greater
inventory  obsolescence  costs.  These  reductions were partially  offset by the
higher relative  percentage of retail sales,  fewer closeout sales and decreased
returns and allowances.

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

     During  the  third  quarter  of fiscal  2004,  selling  and  administrative
expenses were $41.8  million,  a decrease of $0.8 million or 1.8% as compared to
the third  quarter of fiscal 2003. As a percent of sales,  operating  costs were
29.8% in the third quarter of fiscal 2004 compared to 30.5% in the third quarter
of fiscal 2003.  This  decrease in operating  costs as a percentage of net sales
resulted from leveraging cost  containment with the slight increase in net sales
for the 2004 third quarter.  Advertising  costs were up during the third quarter
of fiscal  2004 at 4.5% of net sales  versus  4.2% in fiscal  2003.  The primary
reasons for the third  quarter's  decrease in operating costs were reductions in
bad debt reserves,  outbound freight costs,  salary related expenses and various
other administrative items.

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

     Other income (expense) increased pre-tax income by $0.1 million in both the
third quarter of fiscal 2004 and fiscal 2003.  Investment  income related to the
Company's cash equivalents increased $0.1 million in the third fiscal quarter of
2004.  Higher  average  interest  rates were  sufficient to offset lower average
investment  balances.  Interest  expense was flat in the third quarter of fiscal
2004 as compared to the third quarter of fiscal 2003.  No short-term  borrowings
were made during the third quarters of either fiscal year 2004 or 2003.

     The provision for income taxes  decreased $0.4 million in the third quarter
of fiscal 2004 as compared to the similar  period in fiscal 2003.  This decrease
was  primarily  due to the lower pre-tax  income  amount,  combined with a lower
effective income tax rate. Our effective tax rate was 34.4% in the third quarter
of fiscal  2004 as compared to 36.7% in the third  quarter of fiscal  2003.  The
lower tax rate in the third  quarter  of fiscal  2004  reflects  a  decrease  in
certain state tax accruals that were no longer necessary.


<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 Income
----------

     Net  income  for the third  quarter  of  fiscal  2004 was $6.2  million,  a
decrease  of $0.2  million,  or 3.0% as compared to the same period in the prior
year. The drop in gross profit  dollars was partially  offset by the decrease in
operating  costs and the lower  effective  income tax rate and  resulted  in the
decline in the third quarter's net income versus last year. The Company's return
on net sales of 4.4% in the third  fiscal  quarter of 2004  declined  versus the
4.6% return on sales recorded for the third fiscal quarter of 2003.


<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

First Nine Months of 2004 Compared to the First Nine Months of 2003
-------------------------------------------------------------------

Net Sales
---------

<TABLE>
The first nine months breakdown of net sales is as follows:
                                                                     Percent
                                                                     Change
                                                                     2004 vs.
<CAPTION>
                                               2004        2003        2003
                                             ----------------------------------
                                            (In millions, except percentages)
<S>                                            <C>         <C>         <C>
Stride Rite Children's Group - Wholesale       $76.5       $77.3       (1.1)%
Stride Rite Children's Group - Retail          112.5       103.4         8.8%
                                             -------     -------     -------
Stride Rite Children's Group                   189.0       180.7         4.6%

Keds                                           118.7       136.4      (13.0)%
Tommy Hilfiger Footwear                         73.9        75.4       (1.9)%
Sperry Top-Sider                                46.3        44.3         4.5%
Stride Rite International                       21.4        18.3        17.0%
Elimination of intercompany sales              (7.8)       (8.7)        N/A
                                             -------     -------     ------
Total net sales                              $441.5      $446.4        (1.1)%
                                             ======      ======       =====
</TABLE>

     During  the  first  nine  months  of fiscal  2004,  consolidated  net sales
decreased $4.9 million to $441.5 million, or 1.1% below the sales level recorded
in the first nine months of fiscal 2003.  Wholesale net revenues  decreased 4.2%
for the first nine months of 2004,  while overall  retail sales  increased  $9.5
million or 9.0% when  compared to the same period last year.  Unit  shipments of
current line  merchandise for the wholesale  brands during the first nine months
of 2004  decreased  1.8% when  compared to last year's  first nine  months.  The
Company's  average first quality  wholesale selling price declined 1.7% from the
first nine months of 2003. In addition,  closeout sales  decreased  11.8% in the
first nine months of fiscal 2004 as compared to the prior year. Royalty revenues
at $5.3  million  were 12.7% higher in the first nine months of 2004 than in the
same period in the prior year.

     Net sales of the Stride Rite Children's  Group increased 4.6% for the first
nine months of fiscal 2004, compared to the same period of fiscal 2003. Sales to
independent retailers decreased 1.1% during the first nine months of 2004 versus
the same period last year.  The decrease in sales to  independent  retailers was
principally the result of difficulties  during the Spring selling season related
to the Footstar  bankruptcy and weaknesses  with the Munchkin and Tommy Hilfiger
Kids product lines caused by the loss of business at certain mid-tier  accounts.
Partially  offsetting  these  declines  were  increases  in  closeout  sales and
promotional  products,  as well as a  reduction  in returns and  allowances.  As
compared to the first nine months of last year, the Children's  Group has seen a
shift in sales of the Tommy  Hilfiger Kids products  from the  department  store
channel to the mid-tier  channel.  Offsetting the decrease in the wholesale side
of  the  division,   were  the  increased   sales  of  the  Children's   Group's
company-owned  retail stores, which were up 8.8% during the first nine months of
fiscal 2004 versus the same period  last year.  Sales at  comparable  Children's
Group retail stores (stores open for 52 weeks in each 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

increased 6.4% for the first  nine months of fiscal 2004.  A  major reason  for
the increase in the comparable  store sales results was the addition of a number
of newer stores,  which have generally  recorded better sales  performance  than
many of the more mature stores.

     Keds sales decreased in the first nine months of fiscal 2004 due in part to
continued retailer caution in ordering Keds products,  based on poor performance
at retail in the  comparable  period of 2003.  In  addition,  lower sales to the
promotional  channels and less closeouts  further reduced the Keds sales volume.
Sales of Grasshoppers, which are included in the Keds results, were also down as
compared to the same period last year,  due  principally  to the loss of certain
key  retailers.  Partially  offsetting  the  disappointing  performance of their
seasonal  styles,  Keds has  experienced  strong  sales  with  its core  styles,
specifically the newly introduced Microstretch(TM) products.

     The Tommy  Hilfiger  footwear  sales  decreased  1.9% during the first nine
months of fiscal 2004 due to continued weakness in the men's product category as
well as an increase in women's product returns.  Offsetting these decreases were
higher sales of the women's product and the sales related to the introduction of
both the "H" Hilfiger and the Tommy Girl lines.

     Sales of Sperry Top-Sider products increased 4.5% for the first nine months
of fiscal 2004.  This  increase was  primarily the result of strong sales in the
men's  product  lines,  particularly  in the  performance  category,  as well as
increased  sales of  promotional  products.  This strong  showing was  partially
offset by weaknesses in the women's line, principally in the canvas category and
a  reduction  in  closeout  sales.  Sales were also  adversely  affected  by the
acquisition  of Boat U.S.  retail  operations  by West  Marine,  two key  retail
accounts for the brand.

     The Stride Rite  International  division had a 17.0%  increase in net sales
for the first nine months of 2004, versus the same period in the prior year. The
addition of new distributors of the Company's brands in Asia and the Middle East
and increased  sales of Tommy  Hilfiger and Sperry  Top-Sider  products in Latin
America and Asia were the primary reasons for the increase.

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

     During the first nine months of fiscal 2004, the Company's  gross profit of
$167.7 million  decreased $4.0 million or 2.3% below the amount  recorded during
the same  period last year.  The gross  profit rate for the first nine months of
fiscal 2004 decreased  slightly as compared to the same period last year,  38.0%
to 38.5%.  The  decline  in the gross  profit  percentage  versus  last year was
primarily due to certain product costs,  increased inbound freight and inventory
obsolescence  costs.  This was offset  somewhat by the gross  profit  percentage
impact of the greater percentage of retail sales. The decrease in the first nine
months  gross  profit was  primarily  the result of the lower level of wholesale
sales during the period and increased  inventory  and  obsolescence  costs.  The
additional  gross profit that was generated by the higher levels of retail sales
was insufficient to offset the impact from the decline in gross profit resulting
from these other factors.



<PAGE>



PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

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

     Operating  expenses  for the first nine  months of fiscal  2004 were $127.8
million,  a decrease  of $3.2  million or 2.5% as compared to the same period in
fiscal 2003. As a percent to sales, operating costs were 28.9% in the first nine
months of fiscal 2004 versus 29.3% in the first nine months of last year. During
the first nine months of fiscal 2004,  advertising  expenses as a percent of net
sales were 4.9% versus 5.0% in the same period last year.  Advertising  spending
decreased  as well as salary  related and other  administrative  expenses in the
first nine months of fiscal  2004.  Somewhat  offsetting  these  decreases  were
higher  retail  store  expenses  due to the  increased  number of  company-owned
stores.

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

     Other  income  (expense)  increased  pre-tax  income by $0.9 million in the
first nine months of fiscal 2004 and by $1.4 million in the first nine months of
fiscal 2003.  Investment income in the first nine months of fiscal 2004 was $0.5
million below the same period of fiscal 2003.  Comparisons of investment  income
to last year are negatively  impacted by the receipt in fiscal year 2003 of $0.7
million  related  to  Stride  Rite's  sale of its  interest  in a joint  venture
footwear  manufacturing  facility.  Interest expense in the first nine months of
fiscal 2004 was slightly below the level recorded in the prior year.  There were
no  short-term  borrowings  during the first nine months of both fiscal 2004 and
2003.

     The  provision  for income taxes  decreased  $0.4 million in the first nine
months of fiscal  2004 as  compared  to the same  period  in fiscal  2003.  This
decrease was primarily due to the lower pre-tax income amount offset slightly by
the higher  effective  income tax rate.  During the first nine  months of fiscal
2004, the effective tax rate was 37.3% as compared to the 37.1% rate during last
year's  first nine  months.  The higher tax rate during the first nine months of
fiscal  2004 is the result of fewer tax saving  items this year as  compared  to
fiscal 2003.

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

     Net income for the first nine  months of fiscal 2004 was $25.6  million,  a
decrease  of $0.9  million,  or 3.2% below that of the same  period in the prior
year.  Decreased net sales and the resulting  reduction in gross profit  dollars
were offset by lower operating expenses.  However,  lower other income (expense)
combined with our slightly higher effective income tax rate led to the reduction
in net income during the first nine months of fiscal 2004 versus the same period
last year. The Company's return on net sales of 5.8% in the first nine months of
2004 declined  slightly as compared to the 5.9% return on net sales  realized in
the first nine months of fiscal 2003.



<PAGE>


PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

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

     At the end of the third fiscal quarter of 2004, our balance sheet reflected
a current ratio of 4.7 to 1 with no debt. Our cash and cash equivalents  totaled
$84.9  million at August 27,  2004,  a decrease of $11.3  million from the total
cash and cash  equivalents  of $96.2  million at the end of the third quarter of
fiscal 2003. The Company  maintains a $75 million  revolving  credit facility to
fund any seasonal working capital needs. No borrowings under this line of credit
were outstanding as of August 27, 2004 or August 29, 2003.

     The  Company's  seasonal  cash flow  patterns  typically  provide cash from
operations  during the third  quarter of the fiscal year.  During the first nine
months  of  fiscal  2004,  the  Company  generated  $20.5  million  of cash from
operations.  This  positive  cash flow was below  the  $34.6  million  cash flow
generated  during the first nine months of fiscal 2003. The primary  reasons for
the lower level of cash flow were lower reductions of current liability balances
and  inventory  levels this year  versus the first nine  months of fiscal  2003.
Inventory  levels at the end of the third quarter of fiscal 2004 increased $12.0
million,  or 17.6% from the levels recorded at the end of the prior year's third
quarter.  This  increase  was  primarily  attributable  to the timing of product
receipts and the increase in the number of retail  stores from the third quarter
of 2003. Accounts receivable at August 27, 2004 were $0.4 million or 0.6% higher
than the amount at the end of last year's third quarter. Days sales outstanding,
which  is a  measure  of  the  length  of  the  collection  period  of  accounts
receivable,  was 43 days and 42 days at the end of the third fiscal  quarters of
both  2004 and  2003,  respectively.  Accounts  payable  at the end of the third
quarter of fiscal 2004 increased $7.3 million from the level recorded at the end
of the prior year's third quarter.  This  difference was primarily the result of
an increase in inventory  in-transit  at the end of the third  quarter of fiscal
2004.  During the first fiscal  quarter of 2004,  the Company  contributed  $1.0
million to its defined benefit pension plan. The Company does not intend to make
any  additional  contributions  to its defined  benefit  pension plan this year.
Other  current  assets at August  27,  2004 were $10.1  million or $4.8  million
higher than the amount at the end of last year's third quarter.  This difference
was primarily caused by an increase in prepaid pension  expense,  largely due to
the $6.0 million of pension  contributions  that have occurred  since the end of
last year's third quarter.

     Additions to property and equipment  totaled $5.8 million in the first nine
months of 2004, which was greater than the $5.3 million in the first nine months
of 2003.  During the first nine months of fiscal  2004,  as compared to the same
period last year, the Company increased its spending on information  technology,
e-commerce and new retail stores with lower spending on store renovations and at
its distribution centers.  Funding of our capital expenditures was provided from
internal  sources.  We expect that all capital purchases during fiscal 2004 will
be provided for  internally,  however if business  conditions  change and do not
allow for internal funding, we will re-evaluate our plans.



<PAGE>


 PART I - FINANCIAL INFORMATION (Continued)

                           THE STRIDE RITE CORPORATION

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

     During the first nine months of fiscal 2004 we  returned  $37.1  million to
shareholders through share repurchases and cash dividends. We spent $8.8 million
in the  third  quarter  to  repurchase  847,300  common  shares  under our share
repurchase  program. As of August 27, 2004, 5.5 million shares were remaining on
our share  repurchase  authorization.  On June 24, 2004 the  Company's  Board of
Directors  increased  the  authorization  under our  on-going  share  repurchase
program by 5 million shares. Under the terms of our credit agreement, as amended
on July 13, 2004, we are not allowed to make  distributions  to  stockholders in
excess  of  $50  million   during  fiscal  year  2004.  The  previous  limit  on
distribution  to  stockholders  during the 2004 fiscal year was $40 million.  We
expect to continue to purchase shares opportunistically through the remainder of
the fiscal year.

     At the end of the third  quarter of fiscal 2004,  there were no  borrowings
outstanding under the Company's $75.0 million revolving credit facility. This is
consistent  with the  third  quarter  of fiscal  2003.  We did not  utilize  any
available credit under the revolving credit line during the first nine months of
fiscal 2004.  Borrowings were not required during this time primarily because we
entered  the  year  with no  outstanding  debt and a  significant  cash and cash
equivalents  balance.  As of August 27 2004,  letters of credit  totaling  $25.1
million were outstanding for the purchase of inventories.  All letters of credit
generally expire within one year.

     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.

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  and with the  participation  of the
Company's management,  including the Company's 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 the Exchange Act Rule
13a-15.  Based  upon that  evaluation,  the Chief  Executive  Officer  and Chief
Financial  Officer  concluded  that  the  Company's   disclosure   controls  and
procedures  are  effective  in  timely  alerting  them to  material  information
relating to the Company (including its consolidated subsidiaries) required to be
included in the  Company's  periodic  filings with the  Securities  and Exchange
Commission.

(b) Changes in internal controls.

      None.


<PAGE>


PART II - OTHER INFORMATION

                           THE STRIDE RITE CORPORATION

ITEM 2.     CHANGES IN SECURITIES, USE OF PROCEEDS AND ISSUER PURCHASES OF
            EQUITY SECURITIES

<TABLE>
     Our  repurchases of equity  securities for the third quarter of fiscal 2004
were as follows:

<CAPTION>
                                                          Total
                                                          Number Of  Maximum
                                                          Shares     Number
                                                          Purchased  Of Shares
                                                          As Part    That May
                                      Total       Average Of         Yet Be
                                      Number      Price   Publicly   Purchased
                                      Of          Paid    Announced  Under The
                                      Shares      Per     Plans Or   Plans Or
Period                                Purchased   Share   Programs   Programs
---------------------------------------------------------------------------------
May 29, 2004 - June 25, 2004                  -        -          -  6,394,700

<S>                                    <C>       <C>       <C>      <C>
June 26, 2004 - July 30, 2004           490,200   $10.55    490,200  5,904,500

July 31, 2004 - August 27, 2004         357,100   $10.14    357,100  5,547,400
                                      ---------   ------  ---------  ---------

Total                                   847,300   $10.38    847,300  5,547,400
                                      =========   ======  =========  =========
</TABLE>

     In September  2002,  the Board of Directors  authorized a stock  repurchase
program  allowing the repurchase of up to five million shares of our outstanding
common stock. In June 2004, the Board of Directors  increased the  authorization
under the  existing  stock  repurchase  program by 5 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

                           THE STRIDE RITE CORPORATION

ITEM 6.     EXHIBITS


         (a)    Exhibits. The following exhibits are contained in this report:
                ---------

                Exhibit Number       Description
                --------------       -----------
                10.1                 Second Amendment to Revolving Credit
                                     Agreement between the Registrant and Fleet
                                     National Bank, Bank of America National
                                     Association, The Bank of New York and
                                     SunTrust Bank dated as of July 13, 2004.

                31.1                 Certification of Principal Executive
                                     Officer pursuant to Exchange Act Rules
                                     13a-15(e) and 15d-15(e), as adopted
                                     pursuant to Section 302 of Sarbanes-Oxley
                                     Act of 2002.

                31.2                 Certification of Principal Financial
                                     Officer pursuant to Exchange Act Rules
                                     13a-15(e) and 15d-15(e), as adopted
                                     pursuant to Section 302 of Sarbanes-Oxley
                                     Act of 2002.

                32.1                 Certification of Principal Executive
                                     Officer pursuant to 18 U.S.C. Section 1350,
                                     as adopted pursuant to Section 906 of
                                     Sarbanes-Oxley Act of 2002.

                32.2                 Certification of Principal Financial
                                     Officer pursuant to 18 U.S.C. Section 1350,
                                     as adopted pursuant to Section 906 of
                                     Sarbanes-Oxley Act of 2002.








<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:  October 7, 2004              By:   /s/ Frank A. Caruso
                                    ---------------------------
                                      Frank A. Caruso
                                      Chief Financial Officer