UNITED
STATES


SECURITIES
AND EXCHANGE COMMISSION


WASHINGTON,
D.C.  20549





FORM
10-Q/A


Amendment
No. 1





[X]
Quarterly Report Pursuant to Section 13 or 15(d)


of
the Securities Exchange Act of 1934





For
the quarterly period ended September 30, 2009





[   ]
Transition Report Pursuant to Section 13 or 15(d)


of the
Securities Exchange Act of 1934





For the
transition period from ____________ to _____________





Commission
File Number:  0-30535





GRAYSON
BANKSHARES, INC.


(Exact
name of registrant as specified in its charter)





Virginia
              (State
      or other jurisdiction of
              incorporation
      or organization)
            54-1647596
              (I.R.S.
      Employer
              Identification
      No.)113
      West Main Street
              Independence,
      Virginia
              (Address
      of principal executive offices)
            24348
              (Zip
      Code)





(276)
773-2811


(Registrant’s
telephone number, including area code)





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  R    No  £




Indicate by check mark whether the
registrant has submitted electronically and posted on its corporate Web site, if
any, every Interactive Data File required to be submitted and posted pursuant to
Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12
months (or for such shorter period that the registrant was required to submit
and post such files).  Yes   £    No  £





Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer or a smaller reporting company.  See definition of “large
accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule
12b-2 of the Exchange Act.





Large
accelerated filer  £                                                                                                                                                                                                                                            
Accelerated filer  £


Non-accelerated
filer    £ (Do not check
if smaller reporting
company)                                                                                                                                           
Smaller reporting company  R





Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the
Act).  Yes  £    No  R




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







1,718,968
shares of Common Stock, par value


$1.25 per
share, outstanding as of November 13, 2009.











EXPLANATORY
NOTE





This Amendment No. 1 to the Quarterly
Report on Form 10-Q of Grayson Bankshares, Inc. (the “Company”) for the
quarterly period ended September 30, 2009 that was originally filed with the
Securities and Exchange Commission on November 13, 2009 (the “Form 10-Q”) is
being filed to (i) amend Item 5 of Part II of the Form 10-Q to include
information concerning the appointment of a new member to the Company’s Board of
Directors that was required to be disclosed in a Current Report on Form 8-K
during the period covered by the Form 10-Q, but which was not reported on Form
8-K during that period, and (ii) amend Item 6 of Part II of the Form 10-Q to
update Exhibits 31.1, 31.2 and 32.1.





No other information in the Form 10-Q
is being amended by this Amendment No. 1 and this Amendment No. 1 continues to
speak as of the period ending date in the original filing of the Form
10-Q.








PART
II





Item
5.                                Other
Information.





On July 14, 2009, the Board of
Directors of the Company elected Mr. Hayden H. Horney as a new director of the
Company.  Mr. Horney has served as the Clerk of Circuit Court of Wythe
County, Virginia since 1984.  Pursuant to the Company’s Bylaws, Mr.
Horney was added to the class of directors with terms expiring at the Annual
Meeting of Shareholders to be held on May 11, 2010.  The Board
anticipates naming Mr. Horney to serve on one or more committees of the Board
but at the time of filing this Form 10-Q/A has not determined to which
committees he will be named.





Consistent with the compensation
policies applicable to the Company’s directors, Mr. Horney will be eligible to
receive a fee of $600 for each meeting of the Board and $300 for each committee
meeting he attends.








Item
6.                                Exhibits.





31.1
            Rule
      13(a)-14(a) Certification of Chief Executive
  Officer.





31.2
            Rule
      13(a)-14(a) Certification of Chief Financial
  Officer.





32.1
            Statement
      of Chief Executive Officer and Chief Financial Officer Pursuant to 18
      U.S.C. Section 1350.








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 thereunto duly
authorized.





GRAYSON BANKSHARES, INC.








Dated:
April 9,
2010                                                                                     By:           /s/ Jacky K.
Anderson


Jacky K. Anderson


President and Chief Executive Officer








By:            /s/ Blake M.
Edwards


Blake M. Edwards


Chief
Financial Officer








EXHIBIT
INDEX





Exhibit
No.                                      Description





31.1
            Rule 13(a)-14(a) Certification of
      Chief Executive Officer.





31.2
            Rule 13(a)-14(a) Certification of
      Chief Financial Officer.





32.1
            Statement of Chief Executive
      Officer and Chief Financial Officer Pursuant to 18U.S.C. Section
  1350.