SECURITIES AND EXCHANGE COMMISSION
                             Washington, D. C. 20549
                           ----------------------------

                                    FORM 10-K

{x}  ANNUAL REPORT PURSUANT TO SECTION 13 or 15(D) OF THE SECURITIES EXCHANGE
     ACT OF 1934

                   For the fiscal year ended December 31, 1996
{TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934

     For transition period from.................... to .........................
                   Commission file number 001-06150

                         ALBA  - WALDENSIAN, INC.
             (Exact name of registrant as specified in its charter)

            DELAWARE                                          56-0359780
(State or other jurisdiction of                             (I.R.S. Employer
  incorporation or organization)                            Identification No.)

201 St. Germain Avenue, S.W.
P.O. Box 100 Valdese, North Carolina                     28690
(Address of principal executive offices)               (Zip Code)

Registrant's telephone number, including area code:     704-874-2191

Securities registered pursuant to Section 12 (b) of the Act:

COMMON STOCK ($2.50 PAR VALUE)       AMERICAN STOCK EXCHANGE
     ( Title of class)                    (Name of exchange on which registered)

Securities registered pursuant to Section to Section 12(g) of the Act:  NONE

Indicate by check mark  whether  the  registrant  (1) has filed all  reports
required to be filed by Section 13 or 15 (d) of the  Securities  Exchange Act of
1934 during the  preceding  12 months (or for such  shorter  period that the
registrant was required to file such reports),  and (2) has been subject to such
filing  requirements  for the past 90 days. Yes   X   .  No

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405
of Regulation S-K (ss..229.405 of this chapter) is not contained herein, and
will not be contained, to the best of registrant's knowledge, in definitive
proxy or information statements incorporated by reference in Part III of this
Form 10-K or any amendment to this form 10-K. { }

State the aggregate market value of the voting stock held by the non-affiliates
of the registrant: APPROXIMATELY $4,915,588 AS OF MARCH 15, 1997.

Indicate the number of shares outstanding of each of the registrant's classes of
common stock, as of the latest practicable date: 1,867,403 SHARES OF COMMON
STOCK ($2.50 PAR VALUE) AS OF MARCH 15, 1997.

                       DOCUMENTS INCORPORATED BY REFERENCE

Portions of the Company's Annual Report for the fiscal year ended December 31,
1996 are incorporated by reference into Parts I, II and IV.

Portions of the Company's Proxy Statement for the 1997 Annual Meeting of
Stockholders are incorporated by reference into Parts I and III.


                                                        Page 1 of 25 pages
                                                        (including exhibits) The
                                                        Exhibit Index is located
                                                        on page 23.



<PAGE>



                                     PART I

ITEM 1.    BUSINESS.
GENERAL DEVELOPMENT OF BUSINESS
     Alba-Waldensian, Inc., (the "Company") manufactures a variety of knitted
apparel and health care products at three plants in Valdese, North Carolina and
one plant in Rockwood, TN and markets the products through four divisions, the
Consumer Products Division, the Health Products Division, the Alba Direct
Division and the Byford Apparel Division.
     On March 6, 1995 the Company purchased Balfour Health Products, a
manufacturer of various knit products for the Healthcare industry, from
Kayser-Roth Corporation. The purchase consisted primarily of a manufacturing
facility, in Rockwood, TN., machinery, inventory and certain brand names.
     In 1993, the Company developed a process to knit a seamless bra which was
introduced to the market in 1994 and received a patent for the process in 1996.
This same process is used to manufacture tank tops and body suits which were
introduced in 1995.
     In 1995 the Company underwent a major restructuring. The purchase of
Balfour Health Products early in 1995 gave the Company a manufacturing facility
in Rockwood, Tennessee. The Company consolidated its Health Products
manufacturing and distribution, which was located in three plants in Valdese,
North Carolina, at the Rockwood, Tennessee facility.
   As a result of the Health Products consolidation, the Company was able to
restructure its manufacturing of consumer products in Valdese, North Carolina,
thereby closing two production facilities. One of the facilities (the Main
Street Plant) was sold in September 1995 and the Company plans to sell or lease
the other facility at some point in the future.

                                       2

<PAGE>

FINANCIAL INFORMATION ABOUT INDUSTRY SEGMENTS

     The Company is in a single line of business: the manufacturing, processing,
importing and selling of knitted products, which consists of several classes.
Accordingly, no segment information is presented.

PRINCIPAL PRODUCTS
     The principal products of the Company's four Divisions are described below.
For additional discussion of the current status of each Division and its
products, please see the Company's 1996 Annual Report to Shareholders, which
contains information expressly incorporated herein by reference.

CONSUMER PRODUCTS DIVISION

     Products manufactured and sold by this Division include women's intimate
apparel and women's hosiery products. Intimate apparel includes stretch bikinis,
briefs and bodywear, as well as specially designed briefs for maternity wear.
Women's hosiery products include sheer stockings, pantyhose, and trouser socks,
primarily for large-size women and the maternity market.

     The Company has developed a process which makes it possible to knit bras,
tank tops and body suits on seamless knitting equipment. This design technology,
which is patented for the knit bra, has allowed the Company to significantly
broaden its product offerings. The seamless knit bra was introduced in 1994 and
the tank tops and body suits were introduced in 1995.

     The Company uses state of the art computer-controlled circular-knitting
technology. Such equipment produces apparel that management believes is better
fitting and therefore more comfortable.


                                       3

<PAGE>

     The Company did not renew the license after 1994 acquired from Kayser-Roth
Corporation in 1990 for No-Nonsense (R), or the license acquired from Leslie Fay
Company in 1992 for the Leslie Fay(R) name, both used in connection with women's
hosiery products. Management's decision to terminate both license agreements was
based on the fact that the licenses no longer provided value for the Company and
that both agreements had a high minimum royalty payment. Instead, the Company is
searching for new brand licenses that will position the Company in various types
of trade. The Company has also placed renewed emphasis on placing its All Day
Long(R) brand in department stores.

HEALTH PRODUCTS DIVISION

     Products manufactured and sold by this Division are designed to assist in
healthcare. They include anti-embolism stockings and pulsitate anti-embolism
systems, an intermittent pneumatic compression device, both of which are
designed to improve circulation and reduce the incidence of deep vein
thrombosis; sterile wound dressings such as pre-saturated gauze, petrolatum and
xeroform gauze, non-adhering dressings and gauze strips and XX-Span(R) dressing
retainers, an extensible net tubing designed to hold dressings in place without
the use of adhesive tape. All dressing products are used in wound care therapy,
particularly for the treatment of burns.

         In addition, this Division manufactures a knitted stockinette in a
variety of sizes which is used under fracture casts or is sterile packaged for
use as a supplemental drape in surgical procedures. Heel and elbow pads are
XX-Span(R) sleeves with an inner soft foam pad used to reduce pressure and the
incidence of decubitus ulcers.

                                       4
<PAGE>


    Other products include slip-resistant patient treads, which are knitted soft
patient footwear with slip resistant soles to help prevent patient falls while
keeping feet warm even while in bed; knitted arm sleeves, which provide
protection to the skin of patients with poor circulation; oversize socks for
diabetic patients; baby caps to retain body temperature; and knitted cuffs for
use on surgical gowns.



BYFORD APPAREL DIVISION

     The Byford Division imports and markets a broad range of quality men's
hosiery and sweaters. For the most part, Byford's socks are imported from the
Byford mill in Leicester, England and supplemented with domestic and South
American sources. Sourcing for Byford sweaters comes from Coats Viyella mills in
the United Kingdom, mills in the Far East, and domestic sweater producers. The
men's hosiery incorporates fully reciprocated and reinforced heels and toes.


ALBA DIRECT DIVISION

     Alba Direct distributes products from the Consumer Products Division,
Byford Apparel Division, and Health Products Division to the independent
specialty retail class of trade via telemarketing. Alba Direct has developed
export customers in Japan and Turkey and is the primary group responsible for
developing the Company's Consumer export business.

                                       5

<PAGE>

METHODS OF  DISTRIBUTION

     The Company's products are sold throughout the United States through
salaried and commissioned salesmen. The Consumer Products Division markets its
products directly to chain store organizations, which sell them under their own
labels, and to several companies that market nationally advertised brands.
Byford products are marketed primarily through men's specialty stores, both
chains and independents. Products of the Health Products Division for use in
hospitals are marketed to major distributors by the Company's sales
representatives. These products are sold both under private label and under the
Company's own Life Span(R) Label. Alba Direct distributes branded Consumer
Products and Health Products to the independent retail trade through
telemarketing. Sales offices are located in Valdese, North Carolina and in New
York City. Total expenses for marketing and selling of all products from the
Company's continuing operations was 9.7% of sales in 1996 and 10.0% of sales in
1995. (See "Management's Discussion and Analysis of Financial Conditions and
Results of Operations" in the Company's Annual Report to Shareholders, which is
incorporated herein by reference.)


MANUFACTURING

 All Health Products manufacturing and distribution is located at the Rockwood,
Tennessee plant. The Rockwood plant is a 246,000 square foot building, with
space and available labor market for growth. All products are knitted on
circular knitting equipment. Most of this equipment has been purchased in the
past ten years. Automated seaming, printing and packaging are used in the
finishing process.

                                       6

<PAGE>

Consumer Products manufacturing and distribution is located at three plants in
Valdese, North Carolina. Products are knitted on circular knitting equipment.
Most of the circular knitting equipment is the latest equipment available.
Greige seaming and finishing are manual or automated, depending on product and
size of product. A major improvement during 1995 was the purchase of new
automatic hosiery packaging equipment, which will reduce labor costs and improve
quality.


The Company continues to replace older equipment and automate where possible.
The Company expects capital expenditures for 1997 to be approximately
$2,100,000. The capital expenditures in 1997 will be for purchasing equipment,
upgrading remaining older equipment and computer systems, automating, and
renovating and improving plant facilities.


FINANCIAL INFORMATION ABOUT CLASSES OF SIMILAR PRODUCTS

     The Company is in a single line of business: manufacturing, processing and
selling knitted products, consisting of several classes. The table below
illustrates sales as a percentage of net dollar volume from continuing
operations for each product class for each of the Company's last three years:

                                   1996             1995           1994
                                   ----             -----          ----
Women's Intimate Apparel           28.6%            28.3%          40.2%
Men's Wear                          1.8              2.6            4.3
Women's Hosiery Products           13.8             15.5           17.4
Men's Hosiery                       6.2              6.2            7.9
Health Products                    49.6             47.4           30.2
                                   ----             ----           ----
                                  100.0%           100.0%         100.0%

                                       7

<PAGE>

       o Women's intimate apparel consists of regular size bras, briefs and
 bodywear as well as maternity and plus size briefs.
       o Mens wear consists of Byford Sweaters.
       o Women's hosiery products consist of regular, maternity and plus-size
 panty hose, as well as trouser socks and thigh high hose.
       o Men's hosiery consist of Byford socks and Consumer Product's
 Toesies(R).
       o Health products consist of stockinettes, treads, arm sleeves, mesh
panties, anti-embolism stockings, PAS(R), sterile wound dressings, heel pads,
elbow pads, oversize socks, baby caps, and knitted cuffs.

         Discontinued products are eliminated for the purpose of this table.
The remaining sales percentages of each class were restated after this
elimination to represent sales of each class as a percentage of net dollar
volume from continuing product lines.

NEW PRODUCTS

     The Company maintains an active research and development department that
continually evaluates new products and process. Management also evaluates new
products, business opportunities, and acquisitions on an on-going basis and
could encounter an opportunity which would require substantial investment in the
future. Such investments occurred in 1994 with the acquisition of the pulsitate
anti-embolism business from Baxter Healthcare Corporation and in 1995 with the
acquisition of the Balfour Health Products Division from Kayser-Roth
Corporation. (See "Management's Discussion and Analysis of Financial Condition
and Results of Operations" in the Company's Annual Report to Shareholders.)

                                       8

<PAGE>



SOURCES AND AVAILABILITY OF RAW MATERIALS

     The principal raw materials used by the Company in its manufacturing
processes include various types of yarn, chemicals for dyeing and finishing and
for impregnating medical products and packaging materials for all products. The
Company acquires these materials from a number of sources and is not dependent
on any one source for a significant amount of its raw materials. The Company
anticipates no material change in either the availability or the cost of its raw
materials.


PATENTS AND TRADEMARKS

     The only material patents held by the Company are (1) for a device used to
warm wet dressings, which expires in 2002; (2) for a process covering the
manufacture of dressings, which expires in 2002, and (3) for a process which
makes it possible to knit bras on seamless knitting equipment, which expires in
2014. Also, the Company acquired a exclusive License Agreement for a patented
process which makes it possible to knit briefs. The agreement is for the life of
the patent, which expires in 2012. The material trademarks held by the Company
are: Alba(R), All Day Long(R), ComfortKnit(R), SomeBody(R), While You Wait(R),
Comfort Zone(R), Lady Alba(R), Occasionals(R), Ultimates(R), XX-Span(R),
Speed-Roll(R), Life Span(R), Coplex(R), PAS(R), Baby Bogan(R), Balfour(R),
Care-Steps(R) and Castmate(R). The Company or its subsidiary, Pilot Research
Corporation, holds numerous other patents and trademarks that, because of
obsolescence or other reasons, are not material to the Company's current
operations.

                                       9

<PAGE>


SEASONALITY
     Sales tend to be fairly even throughout the year. For a tabular
presentation of unaudited summary financial information on a quarterly basis,
see the Company's 1996 Annual Report to Shareholders, which information is
incorporated herein by reference.


WORKING CAPITAL
     Differences resulting from seasonal fluctuations have not materially
affected the Company's working capital requirements. The Company sells
merchandise on consignment only on a limited basis. Although returns are
permitted when the quality of merchandise sold is below acceptable standards or
when an error in completing an order occurs, the number and amounts of returns
did not have a material effect on working capital of the Company during fiscal
1996 or 1995. Due to the various approaches to manufacturing and distribution
used by the industry, the Company is not aware of any industry-wide norms
relating to sale and delivery requirements. In 1995 the Company's working
capital was adversely affected as current maturities of long-term debt
increased, due to the financing of the Balfour Health Products acquisition.


SIGNIFICANT CUSTOMERS
    Allegiance Healthcare Corporation (formerly Baxter Healthcare Corporation)
is the only customer that represents ten percent or greater of the Company's
sales volume for the years ended in 1996, 1995 and 1994.


                                       10

<PAGE>


                                           1996         1995         1994
                                           ----         ----         ----
Allegiance Healthcare Corporation          $15,932,382  $16,601,252  $12,902,722
(formerly Baxter  Healthcare Corporation)
         Percentage of sales                      24.2%        26.1%       22.8%

   While the loss of Allegiance Healthcare Corporation would have a material
adverse effect on the business of the Company, management believes that, because
of the number of departments within Allegiance to which the Company sells, the
likelihood of a material amount of sales loss is reduced.

BACKLOG

     The Company's backlog of firm orders at December 31, 1996 and 1995 was
$2,867,901 and $3,651,398 respectively. A majority of the Company's orders are
for delivery within 5 to 60 days; therefore, backlogs are not normally
indicative of orders for the remainder of the year.

COMPETITION

   The Company encounters substantial competition in the sale of its products
from numerous competitors, a few of which are known to have larger sales and
capital resources than the Company. Management is unable to estimate the number
of the Company's competitors or its relative position among them. Management
believes that the principal methods of competition in the markets in which the
Company competes include price, delivery, performance, service and the ability
to bring to the market innovative products. Management believes that the Company
is competitive with respect to these factors but is unable to identify specific
positive and negative aspects of the Company's business

                                       11

<PAGE>

pertaining to such factors. (See also "Management's Discussion and Analysis of
Financial Condition and Results of Operations" in the Company's 1996 Annual
Report to Shareholders.)


RESEARCH AND DEVELOPMENT

     The Company estimates that in 1996 it spent $474,330 on Company-sponsored
research and development projects through the Company's Research and Development
Department and its wholly owned subsidiary, Pilot Research Corporation. This
compares to $490,824 in 1995 and $376,008 in 1994.

ENVIRONMENTAL REGULATIONS

     In the opinion of management, the Company and its subsidiaries are in
substantial compliance with present federal, state and local regulations
regarding the discharge of materials into the environment. Capital expenditures
required to be made in order to achieve such compliance have had no material
effect upon the earnings or competitive position of the Company or its
subsidiaries. Management believes that continued compliance will require no
material expenditures.


GOVERNMENT REGULATION

     The Company is subject to various regulations relating to the maintenance
of safe working conditions and manufacturing practices. In addition, certain of
the products manufactured by the Health Products

                                       12

<PAGE>

Division are subject to the requirements of the Food and Drug Administration
with respect to environmentally controlled facilities. Management believes that
it is currently in compliance with all such regulations.

EMPLOYEES

     The Company had 663 employees as of December 31, 1996. None of the
Company's employees are covered by a collective bargaining agreement. The
Company considers its employee relations to be excellent.


ITEM 2.  PROPERTIES.

     The Company's principal physical properties are listed below:

                         Approximate
                            Square
Name        Location       Footage                    Use
----        --------     -----------                  ---

Alba        Valdese, NC    157,000                    Yarn
                                                      Processing
                                                      (Consumer Products)

Alba        Valdese, NC     18,000                     Not in Use
Annex


John Louis  Valdese, NC    178,300                     Finishing (Consumer
                                                       Products)

Pineburr    Valdese, NC     81,000                     Knitting  (Consumer
                                                       Products)


                                       13

<PAGE>

Rockwood    Rockwood, TN   245,940                     Knitting, Yarn
                                                       Processing  &
                                                       Finishing (Health
                                                       Products)

Office      Valdese, NC     52,000                     Corporate
                                                       headquarters

Offices     New York City    2,488  Leased             Sales Offices
                                    $80,000 Annually
                                    Expires May 1997

AWI Retail  Branson, MO      1,760  Leased             Retail Store (Not in Use)
                                    $32,560 Annually
                                    Expires March 1999


     During 1995 the Company restructured its Valdese, North Carolina
manufacturing operations. As a result the Company only utilizes approximately 8%
of its Alba Plant for a yarn covering operation and leases approximately 11%.
The Company plans to sell or lease the Alba Plant and will move its yarn
covering operation when a suitable purchaser or tenant is found.

     All plants are of brick and steel construction, and most areas have been
air conditioned. All have been maintained in working condition. The Company
leases its New York City office and its Branson, Missouri retail store. The rest
of the Company's physical properties are held in fee simple, subject to
encumbrances that are described in Note 4 and 5 of Notes to Consolidated
Financial Statements in the Company's 1996 Annual Report to Shareholders, which
information is incorporated herein by reference.


ITEM 3.  LEGAL PROCEEDINGS.
LITIGATION

There are no material pending legal proceedings, other than ordinary routine
litigation incidental to the business, to which the Company or any of its
subsidiaries or which any of its properties are subject.

                                       14

<PAGE>

ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     Not applicable.



                                     PART II

ITEM 5.  MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED STOCKHOLDER
         MATTERS.

     The information called for by this item appears beneath the heading "Stock
Prices and Dividend Information" in the Company's 1996 Annual Report to
Shareholders, which information is incorporated herein by reference. The
Company's $2.50 par value Common Stock is registered and traded on the American
Stock Exchange under the symbol "AWS". The Board of Directors has no formal
policy with respect to the payment of dividends and no such dividends have been
declared or paid during the past three fiscal years.

ITEM 6.  SELECTED FINANCIAL DATA.

    The information called for by this item appears beneath the heading
"Five-Year Selected Financial Data" in the Company's 1996 Annual Report to
Shareholders , which information is incorporated herein by reference.


                                       15

<PAGE>

ITEM 7.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
         OPERATIONS

     The information called for by this item appears beneath the heading
"Management's Discussion and Analysis of Financial Condition and Results of
Operations" in the Company's 1996 Annual Report to Shareholders, which
information is incorporated herein by reference.

ITEM 8.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA.

     The information called for by this item appears in the Company's 1996
Annual Report to Shareholders, which information is incorporated herein by
reference.

ITEM 9.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE.

  Not applicable.
                                    PART III

ITEM 10.  DIRECTORS AND EXECUTIVE OFFICERS OF THE REGISTRANT.

     The information regarding Directors called for by this item appears beneath
the heading "Information about Directors and Nominees for Director" in the
Company's Proxy Statement for the 1997 Annual Meeting of Shareholders, which
information is incorporated herein by reference. Such Proxy Statement


                                       16

<PAGE>

will be filed with the Securities and Exchange Commission not later than 120
days after the Company's fiscal year end.

EXECUTIVE OFFICERS

     The following table sets forth certain information about the Company's
executive officers:
Name                            Position with the Company
----                            -------------------------
Lee  N. Mortenson        61     President and Chief Executive
                                Officer

Donald R. Denne, Sr.     60     Senior Vice President and President
                                of the Health Products Division

Thomas I. Nail           49     Treasurer, Secretary and Chief
                                Financial Officer

Dixon R. Johnston        55     Vice President and President of
                                the Consumer Products Division

James Douglas Dickson    40     Assistant Secretary

Warren R. Nesbit         44     Vice President



     The following paragraphs set forth information concerning each executive
officer's business experience:

      Mr. Lee N. Mortenson has been a director of  Alba-Waldensian  since 1984
and was elected  President and Chief Executive  Officer of the Company in
February 1997. He currently serves as President,  Chief Operating  Officer and
Director of Sunstates  Corporation  (formerly Acton  Corporation).  He has been
President,  Chief Operating Officer and Director of Telco Capital Corporation
since 1984. Mr. Mortenson  previously  served as Group Vice President of Gould,
Inc. from 1980 to 1982. Prior to this, he was a Group Vice President with Becton
Dickinson,  Inc. Mr.  Mortenson holds a BS Degree and Masters Degree in
Engineering from UCLA.

     Mr.  Donald R. Denne,  Sr.  joined the Company in 1987 as a Corporate  Vice
President  and  President  of the Health  Products  Division.  Prior to joining
the  Company,  Mr. Denne  served as Vice  President of Marketing  for General
Medical  Corporation,  Vice President of Health Products for Work Wear
Corporation,  and Vice President for Business Planning for American Hospital
Supply.  Mr. Denne has a B.A. degree from Duke University.


                                       17

<PAGE>


     Mr.  Thomas I. Nail  joined  the  Company  as Chief  Financial  Officer in
March of 1994.  He was  elected as Secretary  and  Treasurer  of the Corporation
in May of 1994. Prior to joining the Company, Mr. Nail served as Vice President
of Finance and as a member of the Board of Directors of Burke  Mills,  Inc. for
approximately  six years.  Mr. Nail served as  Controller  of Intercomp Wire and
Cable,  a subsidiary  of Insilco,  Inc. from 1985 to 1987. Mr. Nail has a degree
in Business from Auburn University.

     Mr.  Dixon R.  Johnston  was elected Vice  President  of the Company and
President  of the Consumer  Products Division on February 22, 1996.  Prior to
joining the  Company,  Mr.  Johnston  served as Executive  Vice  President of
Gem-Dandy,  Inc.  from 1995 - 1996.  Mr.  Johnston  served as Director of
Motorsports  & New  Ventures for Sky Box  International  from 1993 to 1995. He
served as  Executive  Vice  President of Trone  Advertising  from 1989-1993.
Mr.  Johnston was president and part owner of Milpak Graphics from 1986 to 1989.
From 1982 to 1986 he was President of  No-nonsense  Fashions, Inc.,  a division
of  Kayser-Roth  Hosiery.  Mr.  Johnston  has a degree in economics from
Northwestern University and an MBA from the University of California, Berkeley.

     Mr.  James  Douglas  Dickson  joined the Company in 1994 as  Corporate
Controller.  He was elected  Assistant Secretary  on  December  15,  1994. Prior
to joining the Company, Mr. Dickson served as Controller of Hickorycraft,  Inc.,
a division of Masco  Corporation,  from 1987 to 1994 and as Division Controller
of Sealed Air Corporation  from 1982 to 1987.  Mr.  Dickson  holds a B.B.A. from
the  University  of Georgia  and is a Certified Management Accountant.

     Mr.  Warren  Nesbit  joined the Company in December,  1985 as Director of
Human  Resources.  He was named Vice President  of Human  Resources  in 1990 and
elected to serve as a Corporate  Vice  President  in 1993. Mr. Nesbit served as
Vice President of Industrial  Relations  with Marion  Manufacturing,  in Marion,
North Carolina prior to joining  the  Company.  He  held  various  manufacturing
and  human  resource   responsibilities  with  Burlington Industries from 1978
to 1984.  Mr. Nesbit is a  graduate of the University  of  North Carolina.

     The Company's officers are elected for a one year term at the annual
meeting of the Board of Directors.



ITEM 11.  EXECUTIVE COMPENSATION.

     The information called for by this item appears under the heading
"Executive Compensation" in the Proxy Statement for the Company's 1997 Annual
Meeting of Shareholders, which information is incorporated by reference.


                                       18

<PAGE>

ITEM 12.  SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT.

     The information called for by this item appears under the heading "Voting
Securities and Principal Security Holders" in the Company's Proxy Statement for
the 1997 Annual Meeting of Shareholders, which information is incorporated
herein by reference.

ITEM 13.  CERTAIN RELATIONSHIPS AND TRANSACTIONS.

         The information called for by this item appears under the heading
"Information About Directors and Nominees for Directors" in the Proxy Statement
for the Company's 1997 Annual Meeting of Shareholders, which information is
incorporated by reference.

                                     PART IV

ITEM 14.  EXHIBITS, FINANCIAL STATEMENT SCHEDULES AND REPORTS ON FORM 8-K.

         (a)  The following are filed as a part of this report:
              (1)  Financial statements filed:
                   (i)  The following consolidated financial statements of the
                          Company and its subsidiaries included in the Company's
                          1996 Annual Report to shareholders are incorporated
                          herein by reference to the Annual Report as indicated
                        Consolidated Balance Sheets--December 31, 1996 and 1995.
                        Consolidated Statements of Operations--Years
                          ended December 31, 1996, 1995, and 1994.
                        Consolidated Statements of Stockholders'
                          Equity--Years ended December 31, 1996, 1995, and 1994.
                        Consolidated Statements of Cash Flows--Years ended
                          December 31, 1996, 1995, and 1994.
                        Summary of Significant Accounting Policies
                        Notes to Consolidated Financial Statements.

                                       19

<PAGE>


              (2)  Financial Statement Schedules filed:

                   Report of Independent Certified Public Accountants on
                     Financial  Statement Schedule (page S-1 of this report)
                     Schedule II (Valuation and Qualifying Accounts) (page
                     S-2 of this report) All other schedules are omitted
                     as the required information is inapplicable  or is present
                     in the financial statements or related notes thereto.


                  (3)  Exhibits filed:

                       3.1     Certificate of Incorporation, as amended, which
                               is incorporated herein by reference to Exhibit
                               3.1 of  the Company's  1986 Annual Report on
                               Form 10-K.
                       3.1.1   Amendment to Certificate of Incorporation adopted
                               by shareholders which is incorporated herein by
                               reference to Exhibit 3.1 of  the Company's 1987
                               Annual Report on Form 10-K.
                       3.2     Bylaws, which are incorporated herein by
                               reference to Exhibit 3.2 of the Company's 1986
                               Annual Report on form 10-K.
                       4.1     Specimen certificate of common stock, which is
                               incorporated herein by reference to Exhibit 4 of
                               the Company's Registration Statement on Form  S-2
                               (No. 2-83186).
                       4.3     Undertaking of  the Company  to file exhibits
                               pursuant to Item 601 (b) (4) (iii) (A) of
                               Regulation S-K, which is incorporated herein by
                               reference to Exhibit 28 of the Company's 1986
                               Annual Report on Form 10-K.
                       10.5    Office Lease dated March 16, 1982 between the
                               Company and Empire State Building Company, which
                               is incorporated by reference to Exhibit 10.25 of
                               the Company's  Registration Statement on Form S-2
                               (No. 2-83186)
                      *10.6    Deferred Compensation Agreement between the
                               Company and  William  D. Schubert dated April 1,
                               1976, which is incorporated by reference to
                               Exhibit 10.30 of the Company's Registration
                               Statement on Form S-2 (No. 2-83186).
                      *10.7    Deferred Compensation Agreement between the
                               Company and William D. Schubert dated December
                               18, 1984, which is incorporated by reference to
                               Exhibit 10.2 of the Company's Annual Report on
                               Form 10-K for the year ended December 31,
                               1984.
                      *10.8    1983 Key Employee Incentive Stock Option Plan
                               which is incorporated herein by reference to
                               Exhibit 10 of the Company's Quarterly Report on
                               Form 10-Q for the quarter ended March 31, 1983.
                      *10.9    Management Incentive Plan, which is incorporated
                               herein by reference to Exhibit 10.1 of the
                               Company's Annual Report on Form 10-K for the year
                               ended December 31, 1984.
                      *10.10   1989 Non-Qualified Deferred Compensation Plan,
                               which is incorporated herein by reference to
                               Exhibit 10.10 of the Company's Annual Report on
                               Form 10-K for the year ended December 31, 1988.
                      *10.11   1989 Management Incentive Plan which is
                               incorporated herein by reference to Exhibit 10.10
                               of the Company's Annual Report on Form 10-K for
                               the year ended December 31, 1988.

                                       20

<PAGE>


                      *10.12   1992 Non-Qualified Stock Option Plan for
                               Non-Employee Directors, which is incorporated
                               herein by reference to Exhibit 10.12 of the
                               Company's Annual Report on Form 10-K for the
                               fiscal year ended December 31, 1993.
                      *10.13   1993 Long Term Performance Plan, which is
                               incorporated herein by reference to Exhibit 10.13
                               of the Company's Annual Report on Form 10-K for
                               the fiscal year ended December 31, 1993.
                       10.14   Asset Purchase Agreement dated as of March 6,
                               1995 between the Registrant and Kayser-Roth
                               Corporation, which is incorporated herein by
                               reference to Exhibit 2 of the Company's 8-K
                               report dated March 20, 1995.
                       13      1996 Annual Report to Shareholders
 .                      21      List of Subsidiaries of  the Company
                       23.2    Consent of Independent Certified Public
                               Accountants, BDO Seidman LLP
                       27      Financial Data Schedule (filed in electronic
                               format only).  This schedule is furnished for the
                               information of the Commission and is not deemed
                               to be "filed".


*        Identifies compensation plans.


         b.  Reports on Form 8-K:  No reports on Form 8-K were filed during the
             last quarter of the year ended December 31, 1996.

                                       21


<PAGE>


                                   SIGNATURES
  Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned thereunto duly authorized.

                              ALBA-WALDENSIAN, INC.

Date :   March 28, 1997                                  By /s/
                                                         Lee N. Mortenson
                                                         Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated

/s/               .                         /s/
Paul H. Albritton, Jr., Director            William M. Cousins, Jr., Director
March 28, 1997                              March 28, 1997


/s/                                         /s/
C. Alan Forbes, Director                    Clyde Wm. Engle, Chairman of the
March 28, 1997                              Board of Directors
                                            March 28, 1997

/s/                                         /s/
James M. Fawcett, Jr. , Director            Glenn J. Kennedy, Director
March 28, 1997                              March 28, 1997

/s/                                         /s/
Joseph C. Minio, Director                   Lee N. Mortenson , Director and
March 28, 1997                              Chief Executive Officer
                                            (Principal Executive Officer)
                                            March 28, 1997

/s/
Thomas I. Nail
Treasurer and Secretary (Chief
Financial and Accounting Officer)
March 28, 1997


                                       22

<PAGE>


                              ALBA-WALDENSIAN, INC.

                                INDEX TO EXHIBITS



Annual Report on Form 10-K for the Fiscal Year       Commission File No. 1-6150
ended December 31, 1996.

Exhibit Number                             Exhibit
--------------                             -------

      13                                   Annual Report to Shareholders

      21                                   Subsidiaries of the Company as of
                                           December 31, 1996

      23.2                                 Consent of Independent Certified
                                           Public Accountants, BDO Seidman LLP

      27                                   Financial Data schedule (filed in
                                           electronic format only)

                                       23

<PAGE>
                                                                    Schedule II

                          Alba-Waldensian, Inc.
                            and Subsidiaries
                         Valdese, North Carolina

                      Valuation and Qualifying Accounts

<TABLE>
<CAPTION>

                                          Balance at       Charged to      Reduction           Balance
Description/                             Beginning of       Cost and           of               at End
Fiscal Year Ended                           Period          Expenses       Allowance           of Period
<S>                                      <C>               <C>             <C>                 <C>
Year Ended December 31, 1996

Accounts Receivable - Allowance            250,000           109,868          84,868            275,000
   for uncollectible accounts

Notes Receivable - Allowance for                 0
uncollectible accounts

Inventory - Reserve for markdowns          610,504           754,106         641,969            722,641


Year Ended December 1, 1995

Accounts Receivable - Allowance            180,000           145,199          75,199            250,000
    for uncollectible accounts

Notes Receivable - Allowance for                 0
uncollectible accounts

Inventory - Reserve for markdowns          385,200         1,619,013       1,393,709            610,504


Year Ended December 31, 1994

Accounts Receivable - Allowance            194,000            74,933         88,933             180,000
   for uncollectible accounts

Notes Receivable - Allowance for                 0
uncollectible accounts

Inventory - Reserve for markdowns          149,000           579,997        343,797             385,200
</TABLE>