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

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

| GAMCO      INVESTORS, INC.                                          |
|---------------------------------------------------------------------|
| (Exact      name of Registrant as specified in its charter)         |
|                                                                |   |   |   |
| New      York                                                       |   |   | 13-4007862 |
| (State      of other jurisdiction of incorporation or organization) |   |   | (I.R.S.      Employer Identification No.) |
|                                                                |   |   |   |   |
| One      Corporate Center, Rye, NY                                  |   |   | 10580-1422 |
| (Address      of principle executive offices)                       |   |   | (Zip      Code) |
|                                                                |   |   |   |   |
| (914)      921-5100                                                 |
| Registrant’s      telephone number, including areacode        |

| Yes | x | No | o |
|-----|---|----|---|

| Indicate      by check mark whether the registrant is a large accelerated filer, an      accelerated filer, a non-accelerated filer, or a smaller reporting      company.  See the definitions of “large accelerated filer",      "accelerated filer", and "smaller reporting company” in Rule 12b-2 of the      Exchange Act. (Check one): |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|                                                                                                                                                                                                                                                                                                                                                              |
| Large      accelerated filer ¨                                                                                                                                                                                                                                                                                                                               |   | Accelerated      filer x |   |
|                                                                                                                                                                                                                                                                                                                                                              |   |   |   |
| Non-accelerated      filer o                                                                                                                                                                                                                                                                                                                                      |   | Smaller      reporting company o |   |

| Yes | o | No | x |
|-----|---|----|---|

| Class                                     |   | Outstanding      at October 31, 2008 |   |
|-------------------------------------------|--------|--------------------------------------|--------|
| Class      A Common Stock, .001 par value |   | 7,334,683                            |   |
| Class      B Common Stock, .001 par value |   | 20,550,006                           |   |

----

| INDEX                                       |
|---------------------------------------------|
|                                        |
| GAMCO      INVESTORS, INC. AND SUBSIDIARIES |
|                                        |   |
|                                        |   |
| PART I.                                     | FINANCIAL INFORMATION |   |   |   |
|                                        |   |
|                                        |   |
| Item      1.                                | Unaudited      Condensed Consolidated Financial Statements |
|                                        |   |
|                                        | Condensed      Consolidated Statements of Income: |
|                                        | -    Three      months ended September 30, 2008 and 2007 |
|                                        | -    Nine      months ended September 30, 2008 and 2007 |
|                                        |   |
|                                        | Condensed      Consolidated Statements of Financial Condition: |
|                                        | -    September      30, 2008 |
|                                        | -    December      31, 2007 (audited) |
|                                        | -    September      30, 2007 |
|                                        |   |
|                                        | Condensed      Consolidated Statements of Stockholders’ Equity and Comprehensive      Income: |
|                                        | -         Three months ended September 30, 2008 and 2007 |
|                                        | -    Nine      months ended September 30, 2008 and 2007 |
|                                        |   |
|                                        | Condensed      Consolidated Statements of Cash Flows: |
|                                        | -    Nine      months ended September 30, 2008 and 2007 |
|                                        |   |
|                                        | Notes      to Condensed Consolidated Financial Statements |
|                                        |   |
| Item      2.                                | Management’s      Discussion and Analysis of Financial Condition and Results of      Operations |
|                                        | (Including      Quantitative and Qualitative Disclosure about Market  Risk) |
|                                        |   |
| Item      3.                                | Quantitative      and Qualitative Disclosures About Market Risk |
|                                        |   |
| Item      4.                                | Controls      and Procedures |
|                                        |   |
| PART II.                                    | OTHER INFORMATION |   |   |   |   |
|                                        |   |
| Item      2.                                | Changes      in Securities, Use of Proceeds and Issuer Purchases of Equity      Securities |
|                                        |   |
| Item      6.                                | Exhibits |
|                                        |   |
|                                        |   |
|                                        |   |
| SIGNATURES                                  |   |
|                                        |   |

----

| GAMCO      INVESTORS, INC. AND SUBSIDIARIES      |
|--------------------------------------------------|
| CONDENSED      CONSOLIDATED STATEMENTS OF INCOME |
| UNAUDITED                                        |
| (In      thousands, except per share data)       |
|                                             |

|                                                  |   | Three      Months Ended |   |    | Nine      Months Ended |   |
|-------------------------------------------------------|--------|-------------------------|--------|---------|------------------------|--------|
|                                                  |   | September      30,      |   |    | September      30,     |   |
|                                                  |   | 2008                    |   |    | 2007                   |   |   | 2008 |   |   | 2007 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |
| Revenues                                              |   |                    |   |    |                   |   |   |   |   |   |   |   |
| Investment      advisory and incentive fees           |   | $                       | 52,297 |    |                   | $      | 58,392 |   |   | $ | 164,269 |   |   | $ | 172,606 |   |
| Commission      revenue                               |   |                    | 4,098  |    |                   |   | 3,494 |   |   |   | 11,018 |   |   |   | 11,550 |   |
| Distribution      fees and other income               |   |                    | 6,585  |    |                   |   | 6,583 |   |   |   | 19,665 |   |   |   | 19,196 |   |
| Total      revenues                                   |   |                    | 62,980 |    |                   |   | 68,469 |   |   |   | 194,952 |   |   |   | 203,352 |   |
| Expenses                                              |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Compensation                                          |   |                    | 26,148 |    |                   |   | 29,064 |   |   |   | 82,758 |   |   |   | 87,343 |   |
| Management      fee                                   |   |                    | 1,740  |    |                   |   | 3,541 |   |   |   | 6,307 |   |   |   | 10,391 |   |
| Distribution      costs                               |   |                    | 6,743  |    |                   |   | 6,099 |   |   |   | 19,946 |   |   |   | 22,146 |   |
| Other      operating expenses                         |   |                    | 7,076  |    |                   |   | 2,665 |   |   |   | 20,204 |   |   |   | 18,693 |   |
| Total      expenses                                   |   |                    | 41,707 |    |                   |   | 41,369 |   |   |   | 129,215 |   |   |   | 138,573 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Operating      income                                 |   |                    | 21,273 |    |                   |   | 27,100 |   |   |   | 65,737 |   |   |   | 64,779 |   |
| Other      (expense) income                           |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Net      (loss) gain  from investments           |   |                    | (4,786 | )  |                   |   | 514 |   |   |   | (13,165 | )  |   |   | 17,277 |   |
| Interest      and dividend income                     |   |                    | 1,340  |    |                   |   | 6,810 |   |   |   | 10,310 |   |   |   | 20,978 |   |
| Interest      expense                                 |   |                    | (2,139 | )       |                   |   | (2,828 | ) |   |   | (6,405 | ) |   |   | (9,537 | ) |
| Total      other (expense) income, net                |   |                    | (5,585 | )  |                   |   | 4,496 |   |   |   | (9,260 | )  |   |   | 28,718 |   |
| Income      before income taxes and minority interest |   |                    | 15,688 |    |                   |   | 31,596 |   |   |   | 56,477 |   |   |   | 93,497 |   |
| Income      tax provision                             |   |                    | 3,837  |    |                   |   | 13,340 |   |   |   | 19,882 |   |   |   | 37,403 |   |
| Minority      interest                                |   |                    | (134   | )  |                   |   | (81 | )  |   |   | (335 | )  |   |   | 596 |   |
| Net      income                                       |   | $                       | 11,985 |    |                   | $      | 18,337 |   |   | $ | 36,930 |   |   | $ | 55,498 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Net      income per share:                            |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                 |   | $                       | 0.43   |    |                   | $      | 0.65 |   |   | $ | 1.32 |   |   | $ | 1.97 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                                               |   | $                       | 0.43   |    |                   | $      | 0.64 |   |   | $ | 1.32 |   |   | $ | 1.95 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Weighted      average shares outstanding:             |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Basic                                                 |   |                    | 27,602 |    |                   |   | 28,106 |   |   |   | 27,930 |   |   |   | 28,164 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Diluted                                               |   |                    | 28,400 |    |                   |   | 29,099 |   |   |   | 28,746 |   |   |   | 29,148 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends      declared:                              |   | $                       | 1.03   |    |                   | $      | 1.03 |   |   | $ | 1.09 |   |   | $ | 1.09 |   |
|                                                  |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |
| See      accompanying notes.                          |   |                    |   |    |                   |   |   |   |   |   |   |   |   |   |   |   |

----

| GAMCO      INVESTORS, INC. AND SUBSIDIARIES                                                                                                                                       |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|
| CONDENSED      CONSOLIDATED STATEMENTS OF FINANCIAL CONDITION                                                                                                                     |   |
| (In      thousands)                                                                                                                                                               |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                              |   | September      30, |   |   | December      31, |   |   |  September      30, |   |   |
|                                                                                                                                                                              |   | 2008 |   |   | 2007 |   |   |  2007 |   |   |
|                                                                                                                                                                              |   |  (unaudited) |   |   |   |   |   |  (unaudited) |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |
| Cash      and cash equivalents, including restricted cash of $0, $0, and      $443                                                                                                |   | $ | 165,098 |   |   | $ | 168,319 |   |  $ | 195,893 |   |   |
| Investments      in securities, including restricted securities of $0, $0, and      $52,117                                                                                       |   |   | 379,072 |   |   |   | 394,977 |   |   | 386,190 |   |   |
| Investments      in partnerships and affiliates                                                                                                                                   |   |   | 73,234 |   |   |   | 100,031 |   |   | 97,988 |   |   |
| Receivable      from brokers                                                                                                                                                      |   |   | 37,929 |   |   |   | 40,145 |   |   | 36,677 |   |   |
| Investment      advisory fees receivable                                                                                                                                          |   |   | 16,392 |   |   |   | 33,701 |   |   | 18,591 |   |   |
| Other      assets                                                                                                                                                                 |   |   | 23,086 |   |   |   | 20,407 |   |   | 17,432 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      assets                                                                                                                                                                 |   | $ | 694,811 |   |   | $ | 757,580 |   |  $ | 752,771 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| LIABILITIES      AND STOCKHOLDERS' EQUITY                                                                                                                                         |   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Payable      to brokers                                                                                                                                                           |   | $ | 2,492 |   |   | $ | 7,562 |   |  $ | 6,844 |   |   |
| Income      taxes payable, net (A)                                                                                                                                                |   |   | 3,071 |   |   |   | 17,539 |   |   | 21,251 |   |   |
| Accrued      compensation                                                                                                                                                         |   |   | 28,253 |   |   |   | 25,362 |   |   | 43,613 |   |   |
| Capital      lease obligation                                                                                                                                                     |   |   | 5,300 |   |   |   | 2,525 |   |   | 2,593 |   |   |
| Securities      sold, not yet purchased                                                                                                                                           |   |   | 6,620 |   |   |   | 2,229 |   |   | 10,914 |   |   |
| Accrued      expenses and other liabilities                                                                                                                                       |   |   | 16,607 |   |   |   | 38,810 |   |   | 32,820 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      operating liabilities                                                                                                                                                  |   |   | 62,343 |   |   |   | 94,027 |   |   | 118,035 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Long      term liabilities                                                                                                                                                        |   |   |   |   |   |   |   |   |   |   |   |   |
| 5.5%      Senior notes (due May 15, 2013)                                                                                                                                         |   |   | 100,000 |   |   |   | 100,000 |   |   |  100,000 |   |   |
| 6%      Convertible note (due August 14, 2011) (B)                                                                                                                                |   |   | 39,746 |   |   |   | 49,608 |   |   | 49,584 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
|      Total      liabilities                                                                                                                              |   |   | 202,089 |   |   |   |  243,635 |   |   | 267,619 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Minority      interest                                                                                                                                                            |   |   | 10,994 |   |   |   |  12,630 |   |   | 9,497 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Stockholders’      equity                                                                                                                                                   |   |   |   |   |   |   |   |   |   |   |   |   |
| Class      A Common Stock, $0.001 par value; 100,000,000                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
|     shares      authorized; 12,850,162, 12,574,995, 12,173,423                                                                                                |   |   |   |   |   |   |   |   |   |   |   |   |
|     issued,      respectively; 7,395,483, 7,819,741, and 7,438,369    outstanding,      respectively                                 |   |   | 12 |   |   |   | 12 |   |   |  12 |   |   |
| Class      B Common Stock, $0.001 par value; 100,000,000                                                                                                                          |   |   |   |   |   |   |   |   |   |   |   |   |
|     shares      authorized; 24,000,000 shares issued,    20,550,006,      20,626,644, 20,645,816 shares outstanding,    respectively |   |   | 21 |   |   |   | 21 |   |   |  21 |   |   |
| Additional      paid-in capital                                                                                                                                                   |   |   | 244,674 |   |   |   | 230,483 |   |   | 230,068 |   |   |
| Retained      earnings                                                                                                                                                            |   |   | 451,635 |   |   |   | 445,121 |   |   | 421,800 |   |   |
| Accumulated      comprehensive income                                                                                                                                             |   |   | 14,515 |   |   |   | 20,815 |   |   | 17,799 |   |   |
| Treasury      stock, at cost (5,454,679, 4,755,254, and 4,735,054 shares,      respectively)                                                                                 |   |   | (229,129 | )  |   |   | (195,137 | )  |   |  (194,045 | )  |   |
| Total      stockholders' equity                                                                                                                                                   |   |   | 481,728 |   |   |   | 501,315 |   |   | 475,655 |   |   |
|                                                                                                                                                                              |   |   |   |   |   |   |   |   |   |   |   |   |
| Total      liabilities and stockholders' equity                                                                                                                                   |   | $ | 694,811 |   |   | $ | 757,580 |   |  $ | 752,771 |   |   |
|                                                                                                                                                                              |
|                                                                                                                                                                              |
| See      accompanying notes.                                                                                                                                                      |
|                                                                                                                                                                              |
| (A)      At Spetember 30, 2008, Income taxes payable, net included income tax      assets of $4,388.                                                                              |
| (B)      $50 million face value outstanding on December 31, 2007 and September 30,      2007. $40 million outstanding on September 30,  2008.                                |
|                                                                                                                                                                              |

----

| GAMCO      INVESTORS, INC. AND SUBSIDIARIES                                                        |
|----------------------------------------------------------------------------------------------------|
| CONDENSED      CONSOLIDATED STATEMENTS OF STOCKHOLDERS’ EQUITY AND COMPREHENSIVE      INCOME |
| UNAUDITED                                                                                          |
|  (In      thousands)                                                                          |
|                                                                                               |

|                                                                               |   |    |  Three      Months Ended |    |    | Nine      Months Ended |    |
|------------------------------------------------------------------------------------|--------|---------|-------------------------------|---------|---------|------------------------|---------|
|                                                                               |   |    |  September      30,      |    |    | September      30,     |    |
|                                                                               |   |    |  2008                    |    |    |  2007             |    |   | 2008 |   |   | 2007 |   |
| Stockholders’      equity – beginning of period                        |   | $  | 510,929                       |    | $  | 490,793                |    |   | $ | 501,315 |   |   | $ | 451,576 |   |
|                                                                               |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |
| Cumulative      effect of applying the provisions of FIN 48at      January 1, 2007 |   |    | -                             |    |    | -                      |    |   |   | - |   |   |   | (822 | )  |
|                                                                               |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |
| Comprehensive      income:                                                         |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |
|   Net      income                                                        |   |    | 11,985                        |    |    | 18,337                 |    |   |   | 36,930 |   |   |   | 55,498 |   |
|   Foreign      currency translation adjustments                          |   |    | (53                           | )  |    | 14                     |    |   |   | (54 | )  |   |   | 27 |   |
|   Net      unrealized (loss)/gain on securities available for sale       |   |    | (2,876                        | )  |    | (2,108                 | )  |   |   | (6,246 | )  |   |   | 7,244 |   |
| Total      comprehensive income                                                    |   |    | 9,056                         |    |    | 16,243                 |    |   |   | 30,630 |   |   |   | 62,769 |   |
|                                                                               |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |
| Dividends      declared                                                            |   |    | (28,716                       | )       |    | (28,977                | )  |   |   | (30,416 | ) |   |   | (30,668 | ) |
| Stock      based compensation expense                                              |   |    | 1,237                         |    |    | 23                     |    |   |   | 3,639 |   |   |   | 68 |   |
| Conversion      of 6% convertible note                                             |   |    | (77                           | )  |    | -                      |    |   |   | 9,923 |   |   |   | - |   |
| Exercise      of stock options including tax benefit                               |   |    | 65                            |    |    | 35                     |    |   |   | 629 |   |   |   | 301 |   |
| Purchase      of treasury stock                                                    |   |    | (10,766                       | )  |    | (2,462                 | )  |   |   | (33,992 | ) |   |   | (7,569 | ) |
| Stockholders’      equity – end of period                              |   | $  | 481,728                       |    | $  | 475,655                |    |   | $ | 481,728 |   |   | $ | 475,655 |   |
|                                                                               |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |
| See      accompanying notes.                                                       |   |    |                          |    |    |                   |    |   |   |   |   |   |   |   |   |

----

|  GAMCO      INVESTORS, INC. AND SUBSIDIARIES    |
|------------------------------------------------------|
| CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS |
|  UNAUDITED                                      |
|  (In      thousands)                            |
|                                                 |

|                                                                                                                              |   | Nine      Months Ended |                |    |
|-----------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|---------------------|---------|
|                                                                                                                              |   | September      30,     |                |    |
|                                                                                                                              |   | 2008                   |                |    | 2007 |   |   |
| Operating      activities                                                                                                    |   |                   |                |    |   |   |   |
| Net      income                                                                                                                   |   | $                      | 36,930              |    |   |  $ | 55,498 |   |   |
|  Adjustments      to reconcile net income to net cash provided by operating      activities:                            |   |                   |                |    |   |   |   |   |   |
|                                                                                                                              |   |                   |                |    |   |   |   |   |   |
|   Equity      in net losses (gains) from partnerships and      affiliates                                     |   |                   | 6,164               |    |   |   | (5,600 | )  |   |
|   Depreciation      and amortization                                                                          |   |                   | 747                 |    |   |   |        739 |   |   |
|   Stock      based compensation expense                                                                  |   |                   | 3,639               |    |   |   |        68 |   |   |
|   Deferred      income tax                                                                                    |   |                   | (2,503              | )  |   |   | 5,858  |   |   |
|   Tax benefit      from exercise of stock options                                              |   |                   | 2                   |    |   |   |        62 |   |   |
|   Foreign      currency loss / (gain)                                                                    |   |                   | (54                 | )  |   |   |        27 |   |   |
|   Other-than-temporary      loss on available for sale securities                                                       |   |                   | 713                 |    |   |   |        3 |   |   |
|   Impairment      of goodwill                                                                            |   |                   | -                   |    |   |   |        56 |   |   |
|        Acquisition of intangible asset                                                                                       |   |                   | (3,370              | )  |   |   |        - |   |   |
|   Market      value of donated securities                                                                |   |                   | 507                 |    |   |   |        273 |   |   |
|   Minority      interest in net (loss) income of consolidated subsidiaries                                              |   |                   | (165                | )  |   |   | 610 |   |   |
|   Realized      gains on sales of available for sale securities                                                         |   |                   |        (4,041  | )  |   |   |        (657 | )  |   |
|   Realized      gains on sales of trading investments in securities, net                                                |   |                   | (3,273              | )  |   |   |        (16,676 | )  |   |
|   Change      in unrealized value of trading investments in securities and securities      sold, not yet purchased, net |   |                   | 13,823              |    |   |   |        4,453 |   |   |
|        Realized gains on covers of securities sold, not yet purchased,      net                                              |   |                   | (1,068              | )  |   |   | (409 | ) |   |
|   Amortization      on discount on debt                                                                            |   |                   | 138                 |    |   |   | 80 |   |   |
| (Increase)      decrease in operating assets:                                                                                     |   |                   |                |    |   |   |   |   |   |
|    Purchases      of trading investments in securities                                                             |   |                   | (445,246            | )  |   |   |        (1,022,506 | )  |   |
|    Proceeds      from sales of trading investments in securities                                                   |   |                   |        433,710 |    |   |   |        1,152,329 |   |   |
|         Cost of covers on securities sold, not yet purchased                                                            |   |                   | (24,530             | )  |   |   |        (97,552 | )  |   |
|         Proceeds from sales of securities sold, not yet purchased                                                       |   |                   | 29,927              |    |   |   |        112,031 |   |   |
|    Investments      in partnerships and affiliates                                                            |   |                   | (182                | )  |   |   |        (17,998 | )  |   |
|    Distributions      from partnerships and affiliates                                                        |   |                   | 20,932              |    |   |   |        15,719 |   |   |
|    Receivable      from brokers                                                                                    |   |                   | 61                  |    |   |   |        20,320 |   |   |
|    Investment      advisory fees receivable                                                                   |   |                   | 17,422              |    |   |   | 12,529 |   |   |
|    Other      receivables from affiliates                                                                     |   |                   | 3,303               |    |   |   | 5,193 |   |   |
|    Other      assets                                                                                     |   |                   | (436                | )  |   |   |        1,594 |   |   |
| Increase      (decrease) in operating liabilities:                                                                                |   |                   |                |    |   |   |   |   |   |
|    Payable      to brokers                                                                                    |   |                   | (4,980              | )  |   |   |        (28,022 | ) |   |
|    Income      taxes payable                                                                                  |   |                   | (6,617              | )  |   |   |  (2,907 | ) |   |
|    Compensation      payable                                                                                       |   |                   | 4,232               |    |   |   |        12,192 |   |   |
|    Accrued      expenses and other liabilities                                                                     |   |                   | (22,306             | )  |   |   |        (7,892 | )  |   |
| Effects      of consolidation of investment partnerships and offshore funds      consolidated under FIN 46R and EITF 04-5:        |   |                   |                |    |   |   |   |   |   |
| Realized gains      on sales of investments in securities and securities sold, not yet      purchased, net                   |   |                   | (10                 | )  |   |   |        (722 | ) |   |
| Change      in unrealized value of investments in securities and securities sold, not      yet purchased, net                     |   |                   | 946                 |    |   |   |        547 |   |   |
| Equity      in net losses (gains) from partnerships and affiliates                                                                |   |                   | 1,206               |    |   |   |        (835 | )  |   |
| Purchases      of trading investments in securities                                                                               |   |                   | (13,290             | )  |   |   |        (41,400 | ) |   |
| Proceeds      from sales of trading investments in securities                                                                     |   |                   | 11,609              |    |   |   |        45,995 |   |   |
| Investments      in partnerships and affiliates                                                                                   |   |                   | (242                | )  |   |   |        (2,000 | ) |   |
| Cost      of covers on securities sold, not yet purchased                                                                         |   |                   | (11                 | )  |   |   | (651 | )  |   |
| Proceeds      from sales of securities sold, not yet purchased                                                                    |   |                   |  42            |    |   |   | 477 |   |   |
| Distributions      from partnerships and affiliates                                                                               |   |                   | 531                 |    |   |   |        5,589 |   |   |
| Increase      in investment advisory fees receivable                                                                              |   |                   | (113                | )  |   |   |        (26 | ) |   |
| Decrease (increase)      in receivable from brokers                                                                          |   |                   | 2,155               |    |   |   |        (3,315 | )  |   |
| Decrease      (increase) in other assets                                                                                          |   |                   | 39                  |    |   |   |        (138 | )  |   |
| Decrease      in payable to brokers                                                                                               |   |                   | (90                 | )  |   |   |        (1,480 | ) |   |
| (Decrease)      increase in accrued expenses and other liabilities                                                                |   |                   |        (68     | )  |   |   | 237 |   |   |
| (Loss)      gain related to investment partnerships and offshore      funds consolidated under FIN 46R and EITF 04-5, net    |   |                   |        (2,017  | )  |   |   | 839 |   |   |
| Total      adjustments                                                                                                       |   |                   | 17,236              |    |   |   | 147,034 |   |   |
| Net      cash provided by operating activities                                                                          |   |                   | 54,166              |    |   |   | 202,532 |   |   |

----

| GAMCO      INVESTORS, INC. AND SUBSIDIARIES                            |
|------------------------------------------------------------------------|
|  CONDENSED      CONSOLIDATED STATEMENTS OF CASH FLOWS (continued) |
|  UNAUDITED                                                        |
|  (In      thousands)                                              |
|                                                                   |

|                                                                                                                                                                                                                                                                                                                                                            |   | Nine      Months Ended |                |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|---------------------|
|                                                                                                                                                                                                                                                                                                                                                            |   | September      30,     |                |
|                                                                                                                                                                                                                                                                                                                                                            |   | 2008                   |                |   |  2007 |   |   |
|                                                                                                                                                                                                                                                                                                                                                            |   |                   |                |   |   |   |
| Investing      activities                                                                                                                                                                                                                                                                                                                                       |   |                   |                |   |   |   |
| Purchases      of available for sale securities                                                                                                                                                                                                                                                                                                                 |   |  $                |        (1,022  | )  |  $ |  (25,942 | )  |   |
| Proceeds      from sales of available for sale securities                                                                                                                                                                                                                                                                                                       |   |                   |        8,451   |   |   |        2,642 |   |   |
| Net      cash provided by (used in) investing activities                                                                                                                                                                                                                                                                                                   |   |                   |        7,429   |   |   |  (23,300 | )  |   |
|                                                                                                                                                                                                                                                                                                                                                            |   |                   |                |   |   |   |   |   |
| Financing      activities                                                                                                                                                                                                                                                                                                                                       |   |                   |                |   |   |   |   |   |
| Retirement      of 5.22% senior notes                                                                                                                                                                                                                                                                                                                           |   |                   |        -       |   |   |  (82,308 | )  |   |
| Contributions      related to investment partnerships and offshore funds consolidated under      FIN 46R and EITF 04-5, net                                                                                                                                                                                                                                     |   |                   | (346                | ) |   | (645 | )  |   |
| Proceeds      from exercise of stock options                                                                                                                                                                                                                                                                                                                    |   |                   | 630                 |   |   | 238 |   |   |
| Dividends      paid                                                                                                                                                                                                                                                                                                                                             |   |                   |        (30,417 | )  |   |        (30,668 | )  |   |
| Subsidiary      dividends to minority shareholders                                                                                                                                                                                                                                                                                                              |   |                   |        (593    | )  |   |        (531 | )  |   |
| Purchase      of treasury stock                                                                                                                                                                                                                                                                                                                                 |   |                   | (33,992             | )  |   | (7,569 | )  |   |
| Net      cash used in financing activities                                                                                                                                                                                                                                                                                                                      |   |                   | (64,718             | )  |   |  (121,483 | )  |   |
| Net      increase (decrease) in cash and cash equivalents                                                                                                                                                                                                                                                                                                       |   |                   | (3,123              | ) |   | 57,749 |   |   |
| Effect      of exchange rates on cash and cash equivalents                                                                                                                                                                                                                                                                                                      |   |                   | (98                 | )  |   |        31 |   |   |
| Cash      and cash equivalents at beginning of period                                                                                                                                                                                                                                                                                                           |   |                   | 168,319             |   |   | 138,113 |   |   |
| Cash      and cash equivalents at end of period                                                                                                                                                                                                                                                                                                                 |   | $                      | 165,098             |   | $  | 195,893 |   |   |
|                                                                                                                                                                                                                                                                                                                                                            |   |                   |                |   |   |   |   |   |
| Non-cash      activity:                                                                                                                                                                                                                                                                                                                                    |   |
|  -      On January 22, 2008, Cascade Investment, L.L.C. elected to convert $10      million of its $50 million convertible note paying interest of      6% into 188,679 GAMCO Investors, Inc. Class A Common shares.                                                                                                                             |   |
|  -      On September 15, 2008, GAMCO Investors, Inc. modified and extended      its lease with M4E, LLC, the Company’s landlord at 401 Theodore Fremd Ave,      Rye, NY. The lease term was extended to December 31, 2023. This resulted      in an increase to the capital lease obligation and corresponding asset of      $3.0 million each. |   |
|                                                                                                                                                                                                                                                                                                                                                            |   |                   |                |   |   |   |   |   |

----

----

| -   | Level      1 inputs utilize quoted prices (unadjusted) in active markets for      identical assets or liabilities.                                                                                                                                                                                                                                                                                                                                              |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| -   | Level      2 inputs utilize inputs other than quoted prices included in Level 1 that      are observable for the asset or liability, either directly or indirectly.      Level 2 inputs include quoted prices for similar assets and liabilities in      active markets and inputs other than quoted prices that are observable for      the asset or liability, such as interest rates and yield curves that are      observable at commonly-quoted intervals. |
| -   | Level      3 inputs are unobservable inputs for the asset or liability, and include      situations where there is little, if any, market activity for the asset or      liability.                                                                                                                                                                                                                                                                        |

| Assets                                  |   | Quoted      Prices in Active Markets for Identical Assets (Level 1) |    |   | Significant      Other Observable Inputs (Level 2) |   |   | Significant      Unobservable Inputs (Level 3) |   |   | Balance      as of September 30, 2008 |   |
|-----------------------------------------|--------|---------------------------------------------------------------------|---------|--------|----------------------------------------------------|--------|--------|------------------------------------------------|--------|--------|---------------------------------------|--------|
| Cash      and cash equivalents          |   | $                                                                   | 165,098 |   |                                               | $      | -      |                                           |   | $      | -                                     |   |   | $ | 165,098 |   |
| Investments      in securities:         |   |                                                                |    |   |                                               |   |   |                                           |   |   |                                  |   |   |   |   |   |
|         Available-for-sale    |   |                                                                | 116,865 |   |                                               |   | -      |                                           |   |   | -                                     |   |   |   | 116,865 |   |
|         Trading               |   |                                                                | 260,607 |   |                                               |   | 18     |                                           |   |   | 1,582                                 |   |   |   | 262,207 |   |
| Total      investments in securities    |   |                                                                | 377,472 |   |                                               |   | 18     |                                           |   |   | 1,582                                 |   |   |   | 379,072 |   |
| Total      financial instruments owned  |   | $                                                                   | 542,570 |   |                                               | $      | 18     |                                           |   | $      | 1,582                                 |   |   | $ | 544,170 |   |
| Liabilities                             |   |                                                                |    |   |                                               |   |   |                                           |   |   |                                  |   |   |   |   |   |
| Securities      sold, not yet purchased |   | $                                                                   | 6,620   |   |                                               | $      | -      |                                           |   | $      | -                                     |   |   | $ | 6,620 |   |

----

|                                     |   |                   |   |   | Total      Realized and Unrealized Gains or (Losses) in Income |   |   |        |   |   |                                                                                |   |   |                                                 |   |   |                          |   |   |                                          |   |
|------------------------------------------|--------|------------------------|--------|--------|----------------------------------------------------------------|--------|--------|-------------|--------|--------|-------------------------------------------------------------------------------------|--------|--------|------------------------------------------------------|--------|--------|-------------------------------|--------|--------|-----------------------------------------------|--------|
| Asset                                    |   | Beginning      Balance |   |   | Trading                                                        |   |   | Investments |   |   | Total      Unrealized Gains or (Losses) Included in Other Comprehensive      Income |   |   | Total      Realized and Unrealized Gains or (Losses) |   |   | Purchases      and Sales, net |   |   | Net      Transfers In and/or (Out) of Level 3 |   |   | Ending      Balance |   |
| Financial      instruments owned:        |   |                   |   |   |                                                           |   |   |        |   |   |                                                                                |   |   |                                                 |   |   |                          |   |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments      in securities - trading |   | $                      | 2,012  |   |                                                           | $      | (100   | )           |   | $      | -                                                                                   |   |   | $                                                    | -      |   |                          | $      | (100   | )                                             |   | $ | (205 | )  |   | $ | (125 | )  |   | $ | 1,582 |   |
|  Total                              |   | $                      | 2,012  |   |                                                           | $      | (100   | )           |   | $      | -                                                                                   |   |   | $                                                    | -      |   |                          | $      | (100   | )                                             |   | $ | (205 | )  |   | $ | (125 | )  |   | $ | 1,582 |   |

|                                     |   |                   |   |   | Total      Realized and Unrealized Gains or (Losses) in Income |   |   |        |   |   |                                                                                |   |   |                                                 |   |   |                          |   |   |                                          |   |
|------------------------------------------|--------|------------------------|--------|--------|----------------------------------------------------------------|--------|--------|-------------|--------|--------|-------------------------------------------------------------------------------------|--------|--------|------------------------------------------------------|--------|--------|-------------------------------|--------|--------|-----------------------------------------------|--------|
| Asset                                    |   | Beginning      Balance |   |   | Trading                                                        |   |   | Investments |   |   | Total      Unrealized Gains or (Losses) Included in Other Comprehensive      Income |   |   | Total      Realized and Unrealized Gains or (Losses) |   |   | Purchases      and Sales, net |   |   | Net      Transfers In and/or (Out) of Level 3 |   |   | Ending      Balance |   |
| Financial      instruments owned:        |   |                   |   |   |                                                           |   |   |        |   |   |                                                                                |   |   |                                                 |   |   |                          |   |   |                                          |   |   |   |   |   |   |   |   |   |   |   |   |
| Investments      in securities - trading |   | $                      | 1,423  |   |                                                           | $      | (637   | )           |   | $      | -                                                                                   |   |   | $                                                    | -      |   |                          | $      | (637   | )                                             |   | $ | 530 |   |   | $ | 266 |   |   | $ | 1,582 |   |
|  Total                              |   | $                      | 1,423  |   |                                                           | $      | (637   | )           |   | $      | -                                                                                   |   |   | $                                                    | -      |   |                          | $      | (637   | )                                             |   | $ | 530 |   |   | $ | 266 |   |   | $ | 1,582 |   |

----

| (in thousands,      except per share amounts)                                  |   | Three      Months EndedSeptember      30, 2008 |   |   | Three      Months EndedSeptember      30, 2007 |   |   | Nine      Months EndedSeptember      30, 2008 |   |   | Nine      Months EndedSeptember      30, 2007 |   |
|-------------------------------------------------------------------------------------|--------|------------------------------------------------|--------|--------|------------------------------------------------|--------|--------|----------------------------------------------------|--------|--------|----------------------------------------------------|--------|
| Basic:                                                                              |   |                                           |   |   |                                           |   |   |                                               |   |   |                                               |   |
| Net      income                                                                     |   | $                                              | 11,985 |   |                                           | $      | 18,337 |                                               |   | $      | 36,930                                             |   |   | $ | 55,498 |   |
| Average      shares outstanding                                                     |   |                                           | 27,602 |   |                                           |   | 28,106 |                                               |   |   | 27,930                                             |   |   |   | 28,164 |   |
| Basic      net income per share                                                     |   | $                                              | 0.43   |   |                                           | $      | 0.65   |                                               |   | $      | 1.32                                               |   |   | $ | 1.97 |   |
|                                                                                |   |                                           |   |   |                                           |   |   |                                               |   |   |                                               |   |   |   |   |   |
| Diluted:                                                                            |   |                                           |   |   |                                           |   |   |                                               |   |   |                                               |   |   |   |   |   |
| Net      income                                                                     |   | $                                              | 11,985 |   |                                           | $      | 18,337 |                                               |   | $      | 36,930                                             |   |   | $ | 55,498 |   |
| Add      interest expense on convertible note, net of management fee and      taxes |   |                                           | 343    |   |                                           |   | 429    |                                               |   |   | 1,052                                              |   |   |   | 1,286 |   |
| Total                                                                               |   | $                                              | 12,328 |   |                                           | $      | 18,766 |                                               |   | $      | 37,982                                             |   |   | $ | 56,784 |   |
|                                                                                |   |                                           |   |   |                                           |   |   |                                               |   |   |                                               |   |   |   |   |   |
| Average      shares outstanding                                                     |   |                                           | 27,602 |   |                                           |   | 28,106 |                                               |   |   | 27,930                                             |   |   |   | 28,164 |   |
| Dilutive      stock options                                                         |   |                                           | 43     |   |                                           |   | 50     |                                               |   |   | 43                                                 |   |   |   | 41 |   |
| Assumed      conversion of convertible note                                         |   |                                           | 755    |   |                                           |   | 943    |                                               |   |   | 773                                                |   |   |   | 943 |   |
| Total                                                                               |   |                                           | 28,400 |   |                                           |   | 29,099 |                                               |   |   | 28,746                                             |   |   |   | 29,148 |   |
| Diluted      net income per share                                                   |   | $                                              | 0.43   |   |                                           | $      | 0.64   |                                               |   | $      | 1.32                                               |   |   | $ | 1.95 |   |

|           |   |   | 2007   |   |   | 2008   |   |   | 2009   |   |   | 2010   |   |   | 2011   |   |   | 2012   |   |   |  2013 |   |   |
|----------------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|--------|------------|--------|--------|
|           | Q1     |   |   | $      | 21     |   |   | $      | 1,198  |   |   | $      | 1,250  |   |   | $      | 1,239  |   |   | $      | 745        |   |   | $ | 718 |   |   |  $ | 32 |   |   |
|           | Q2     |   |   |   | 24     |   |   |   | 1,204  |   |   |   | 1,246  |   |   |   | 1,236  |   |   |   | 742        |   |   |   | 717 |   |   |   |  32 |   |   |
|           | Q3     |   |   |   | 24     |   |   |   | 1,237  |   |   |   | 1,244  |   |   |   | 1,235  |   |   |   | 725        |   |   |   | 717 |   |   |   |  10 |   |   |
|           | Q4     |   |   |   | 414    |   |   |   | 1,252  |   |   |   | 1,243  |   |   |   | 1,072  |   |   |   | 718        |   |   |   | 488 |   |   |   |  - |   |   |
| Full      Year |   |   | $      | 483    |   |   | $      | 4,891  |   |   | $      | 4,983  |   |   | $      | 4,782  |   |   | $      | 2,930  |       |   | $      | 2,640 |   |   |  $ |  74 |   |   |

----

|                                        |   |    | (In      thousands)  |   |   |
|---------------------------------------------|--------|---------|---------------------------|--------|--------|
|  Remainder      of 2008                |   |  $ | 219                       |   |   |
|  2009                                  |   |    | 1,080                     |   |   |
|  2010                                  |   |    | 1,080                     |   |   |
|  2011                                  |   |    | 1,080                     |   |   |
|  2012                                  |   |    | 1,080                     |   |   |
|  2013                                  |   |    | 1,080                     |   |   |
|  Thereafter                            |   |    | 10,800                    |   |   |
|  Total      minimum obligations        |   |    | 16,419                    |   |   |
|  Interest                              |   |    | 11,119                    |   |   |
|  Present      value of net obligations |   |  $ | 5,300                     |   |   |

----

| -   | Our      open-end equity fund AUM were $8.4 billion on September 30, 2008, 11.2%      less than $9.5 million on June 30, 2008 and 14.6% below $9.9 million on      September 30, 2007. The reclassification of the Enterprise Mergers and      Acquisitions Fund from institutional sub-advisory to mutual fund advisory      in March 2008 partially softened the decline in mutual funds AUM from the      prior year level. |
|---------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Our      closed-end equity funds had AUM of $4.9 billion on September 30, 2008,      down 14.6% from $5.7 billion on June 30, 2008 and 24.4% under the $6.4      billion on September 30, 2007. |
|---------------|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Our      institutional and private wealth management business ended the quarter      with $10.9 billion in separately managed accounts, 5.8% below June 30,      2008 of $11.6 billion and 20.6% lower than the $13.8 billion on September      30, 2007. On a pro-forma basis, AUM were 16.1% lower than the adjusted      $13.0 million AUM on September 30,2007. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Our      Investment Partnerships AUM were $340 million on September 30, 2008 versus      $354 million on June 30, 2008 and $491 million on September 30,      2007. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | Fixed      income AUM declined 12.4% to $1.0 billion on September 30, 2008, versus      the $1.2 billion on June 30, 2008 and 3.8% below September 30, 2007      AUM. |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| -   | We      receive incentive fees for certain institutional client assets, preferred      issues for our closed-end funds, common shares of the Gabelli Global Deal      Fund (NYSE: GDL) and investment partnership assets. As of September 30,      2008, incentive and fulcrum fee assets were $3.1 billion, down 2.3% from      the $3.2 billion on June 30, 2008 and 15.4% below the $3.7 billion on      September 30, 2007. |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

|   |   |
|--------|--------|

----

|  Table I:                     |   |                    |   |   |                    |   |                    |   |   |                              |   |   |
|------------------------------------|--------|-------------------------|--------|--------|-------------------------|--------|-------------------------|--------|--------|-----------------------------------|--------|--------|
| Mutual      Funds:                 |   | September      30, 2008 |   |   | September      30, 2007 |   |  %      Inc.(Dec.) |   |   |  Adj.      % Inc. (Dec.) (a) |   |   |
| Open-end                           | $      | 8,421                   |   | $      | 9,866                   |   | (14.6                   | )      |   | (20.6                             | )      |   |
| Closed-end                         |   | 4,869                   |   |   |        6,443       |   | (24.4                   | )      |   | (24.4                             | )      |   |
| Fixed      Income                  |   | 1,015                   |   |   |        1,048       |   | (3.1                    | )      |   | (3.1                              | )      |   |
| Total      Mutual Funds            |   | 14,305                  |   |   |  17,357            |   | (17.6                   | )      |   | (20.9                             | )      |   |
| Institutional      & PWM:      |   |                    |   |   |                    |   |                    |   |   |                              |   |   |
| Equities:      direct              |   | 8,964                   |   |   |  11,266            |   | (20.6                   | )      |   | (20.6                             | )      |   |
| Equities:      sub-advisory        |   | 1,964                   |   |   |  2,494             |   | (21.3                   | )      |   | 11.8                              |   |   |
| Fixed      Income                  |   | 19                      |   |   |        27          |   | (29.6                   | )      |   | (29.6                             | )      |   |
| Total      Institutional & PWM |   | 10,947                  |   |   | 13,787                  |   | (20.6                   | )      |   | (16.1                             | )      |   |
| Investment      Partnerships       |   | 340                     |   |   | 491                     |   | (30.8                   | )      |   | (30.8                             | )      |   |
| Total      Assets Under Management | $      | 25,592                  |   | $      | 31,635                  |   | (19.1                   | )      |   | (19.1                             | )      |   |
|                               |   |                    |   |   |                    |   |                    |   |   |                              |   |   |
| Equities                           | $      | 24,558                  |   | $      | 30,560                  |   | (19.6                   | )      |   | (19.6                             | )      |   |
| Fixed      Income                  |   | 1,034                   |   |   | 1,075                   |   | (3.8                    | )      |   | (3.8                              | )      |   |
| Total      Assets Under Management | $      | 25,592                  |   | $      | 31,635                  |   | (19.1                   | )      |   | (19.1                             | )      |   |

|  TableII:                     |   | Assets      Under Management By Quarter (millions) |   |
|------------------------------------|--------|----------------------------------------------------|--------|
|                               |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   | %      Increase/(decrease) |   |
| Mutual      Funds:                 |   |                                               | 9/08   |   |   |   | 6/08 |   |   |   | 3/08 |   |   |   | 12/07 |   |   |   | 9/07 |   |   |   | 12/07 |  (a) |   | 6/08  |   |   |   |   |   |
| Open-end                           |   | $                                                  | 8,421  |   |   | $ | 9,486 |   |   | $ | 9,459 |   |   | $ | 9,774 |   |   | $ | 9,866 |   |   |   | (19.4 | ) |   | (11.2 | ) |   |   |   |   |
| Closed-end                         |   |                                               | 4,869  |   |   |   | 5,704 |   |   |   |        5,762 |   |   |   | 6,341 |   |   |   |        6,443 |   |   |   | (23.2 | ) |   | (14.6 | ) |   |   |   |   |
| Fixed      income                  |   |                                               | 1,015  |   |   |   | 1,164 |   |   |   |        1,445 |   |   |   | 1,122 |   |   |   |        1,048 |   |   |   | (9.5 | ) |   | (12.8 | ) |   |   |   |   |
| Total      Mutual Funds            |   |                                               | 14,305 |   |   |   | 16,354 |   |   |   |  16,666 |   |   |   | 17,237 |   |   |   |  17,357 |   |   |   | (17.0 | ) |   | (12.5 | ) |   |   |   |   |
| Institutional      & PWM:      |   |                                               |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |   |
| Equities:      direct              |   |                                               | 8,964  |   |   |   | 9,564 |   |   |   |  9,746 |   |   |   | 10,708 |   |   |   |  11,266 |   |   |   | (16.3 | ) |   | (6.3 | ) |   |   |   |   |
| Equities:      sub-advisory        |   |                                               | 1,964  |   |   |   | 2,043 |   |   |   |  1,887 |   |   |   | 2,584 |   |   |   |  2,494 |   |   |   | 2.8 |   |   | (3.9 | ) |   |   |   |   |
| Fixed      Income                  |   |                                               | 19     |   |   |   | 17 |   |   |   |        2 |   |   |   | 24 |   |   |   |        27 |   |   |   | (20.8 | ) |   | 11.8 |   |   |   |   |   |
| Total      Institutional & PWM |   |                                               | 10,947 |   |   |   | 11,624 |   |   |   | 11,635 |   |   |   | 13,316 |   |   |   | 13,787 |   |   |   | (17.8 | ) |   | (5.8 | ) |   |   |   |   |
| Investment      Partnerships       |   |                                               | 340    |   |   |   | 354 |   |   |   | 396 |   |   |   | 460 |   |   |   | 491 |   |   |   | (26.1 | ) |   | (4.0 | ) |   |   |   |   |
| Total      Assets Under Management |   | $                                                  | 25,592 |   |   | $ | 28,332 |   |   | $ | 28,697 |   |   | $ | 31,013 |   |   | $ | 31,635 |   |   |   | (17.5 | ) |   | (9.7 | ) |   |   |   |   |

| Table      III:                    |   |   |                     |   |   |                |   |   |                                            |    |   |                          |   |   |   |
|------------------------------------|--------|--------|--------------------------|--------|--------|---------------------|--------|--------|-------------------------------------------------|---------|--------|-------------------------------|--------|--------|--------|
|                               |   |   |  June      30, 2008 |   |   | Net      Cash Flows |   |   |  Market      Appreciation / (Depreciation) |    |   |  September      30, 2008 |   |   |   |
|                               |   |   |                     |   |   |                |   |   |                                            |    |   |                          |   |   |   |
| Mutual      Funds:                 |   |   |                     |   |   |                |   |   |                                            |    |   |                          |   |   |   |
| Equities                           |   | $      | 15,190                   |   | $      | (141                | )      | $      |        (1,759                              | )  | $      |        13,290            |   |   |   |
| Fixed      Income                  |   |   | 1,164                    |   |   |        (154    | )      |   |        5                                   |    |   |        1,015             |   |   |   |
| Total      Mutual Funds            |   |   | 16,354                   |   |   |        (295    | )      |   |        (1,754                              | )  |   |        14,305            |   |   |   |
| Institutional      & PWM:      |   |   |                     |   |   |                |   |   |                                            |    |   |                          |   |   |   |
| Equities:      direct              |   |   | 9,564                    |   |   | 72                  |   |   |        (672                                | )  |   | 8,964                         |   |   |   |
| Equities: sub-advisory        |   |   | 2,043                    |   |   |        36      |   |   |        (115                                | )  |   | 1,964                         |   |   |   |
| Fixed      Income                  |   |   | 17                       |   |   |        3       |   |   |        (1                                  | )  |   | 19                            |   |   |   |
| Total      Institutional & PWM |   |   | 11,624                   |   |   |        111     |   |   |        (788                                | )  |   |        10,947            |   |   |   |
|                               |   |   |                     |   |   |                |   |   |                                            |    |   |                          |   |   |   |
| Investment      Partnerships       |   |   | 354                      |   |   |        (9      | )      |   |        (5                                  | )  |   |        340               |   |   |   |
| Total      Assets Under Management |   | $      | 28,332                   |   | $      |        (193    | )      | $      |        (2,547                              | )  | $      |        25,592            |   |   |   |

----

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | 2008   |   |    | 2007   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|---------|--------|
| Revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |    |   |
|   Investment      advisory and incentive fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 52,297 |    |   | $ | 58,392 |   |
|   Commission      revenue                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 4,098  |    |   |   | 3,494 |   |
|   Distribution      fees and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 6,585  |    |   |   | 6,583 |   |
|      Total      revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 62,980 |    |   |   | 68,469 |   |
| Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |   |    |   |   |   |   |
|   Compensation      and related costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 26,148 |    |   |   | 29,064 |   |
|   Management      fee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 1,740  |    |   |   | 3,541 |   |
|   Distribution      costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 6,743  |    |   |   | 6,099 |   |
|   Other      operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 7,076  |    |   |   | 2,665 |   |
|      Total      expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 41,707 |    |   |   | 41,369 |   |
| Operating      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 21,273 |    |   |   | 27,100 |   |
| Other      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   |   |    |   |   |   |   |
| Net      gain from investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | (4,786 | )  |   |   | 514 |   |
| Interest      and dividend income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 1,340  |    |   |   | 6,810 |   |
| Interest      expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | (2,139 | )       |   |   | (2,828 | ) |
| Total      other income, net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |   |   | (5,585 | )  |   |   | 4,496 |   |
| Income      before taxes and minority interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 15,688 |    |   |   | 31,596 |   |
| Income      tax provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 3,837  |    |   |   | 13,340 |   |
| Minority      interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | (134   | )  |   |   | (81 | )  |
| Net      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $      | 11,985 |    |   | $ | 18,337 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |   |    |   |   |   |   |
| Net      income per share:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |   |    |   |   |   |   |
|    Basic                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 0.43   |    |   | $ | 0.65 |   |
|    Diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $      | 0.43   |    |   | $ | 0.64 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |   |    |   |   |   |   |
| Reconciliation      of Net income to Adjusted EBITDA:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |   |    |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |   |    |   |   |   |   |
| Net      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $      | 11,985 |    |   | $ | 18,337 |   |
| Interest      Expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 2,139  |    |   |   | 2,828 |   |
| Income      tax provision and minority interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 3,703  |    |   |   | 13,259 |   |
| Depreciation      and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 263    |    |   |   | 217 |   |
| Adjusted      EBITDA (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $      | 18,090 |    |   | $ | 34,641 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |   |    |   |   |   |   |
| (a)      Adjusted EBITDA is defined as earnings before interest, taxes,      depreciation and amortization, and minority interest.  Adjusted      EBITDA is a non-GAAP measure and should not be considered as an      alternative to any measure of performance as promulgated under accounting      principles generally accepted in the United States nor should it be      considered as an indicator of our overall financial      performance.  We use Adjusted EBITDA as a supplemental measure      of performance as we believe it gives investors a more complete      understanding of our operating results before the impact of financing      activities as a tool for determining the private market value of an      enterprise. |

----

|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   | 2008   |    |    | 2007   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|---------|---------|--------|
| Revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |    |    |   |
|   Investment      advisory and incentive fees                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 164,269 |    |   | $ | 172,606 |   |
|   Commission      revenue                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 11,018  |    |   |   | 11,550 |   |
|   Distribution      fees and other income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 19,665  |    |   |   | 19,196 |   |
|      Total      revenues                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 194,952 |    |   |   | 203,352 |   |
| Expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   |   |    |    |   |   |   |   |
|   Compensation      and related costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 82,758  |    |   |   | 87,343 |   |
|   Management      fee                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 6,307   |    |   |   | 10,391 |   |
|   Distribution      costs                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |   |   | 19,946  |    |   |   | 22,146 |   |
|   Other      operating expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 20,204  |    |   |   | 18,693 |   |
|      Total      expenses                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 129,215 |    |   |   | 138,573 |   |
| Operating      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 65,737  |    |   |   | 64,779 |   |
| Other      income (expense)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          |   |   |    |    |   |   |   |   |
| Net      gain (loss) from investments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | (13,165 | )  |   |   | 17,277 |   |
| Interest      and dividend income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    |   |   | 10,310  |    |   |   | 20,978 |   |
| Interest      expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | (6,405  | )       |   |   | (9,537 | ) |
| Total      other income (expense), net                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | (9,260  | )  |   |   | 28,718 |   |
| Income      before taxes and minority interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       |   |   | 56,477  |    |   |   | 93,497 |   |
| Income      tax provision                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   |   | 19,882  |    |   |   | 37,403 |   |
| Minority      interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               |   |   | (335    | )  |   |   | 596 |   |
| Net      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $      | 36,930  |    |   | $ | 55,498 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |    |    |   |   |   |   |
| Net      income per share:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |   |   |    |    |   |   |   |   |
|    Basic                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              |   | $      | 1.32    |    |   | $ | 1.97 |   |
|    Diluted                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            |   | $      | 1.32    |    |   | $ | 1.95 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |    |    |   |   |   |   |
| Reconciliation      of Net income to Adjusted EBITDA:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   |    |    |   |   |   |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |    |    |   |   |   |   |
| Net      income                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   | $      | 36,930  |    |   | $ | 55,498 |   |
| Interest      Expense                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                |   |   | 6,405   |    |   |   | 9,537 |   |
| Income      tax provision and minority interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      |   |   | 19,547  |    |   |   | 37,999 |   |
| Depreciation      and amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |   |   | 747     |    |   |   | 739 |   |
| Adjusted      EBITDA (a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             |   | $      | 63,629  |    |   | $ | 103,773 |   |
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |   |   |    |    |   |   |   |   |
| (a)      Adjusted EBITDA is defined as earnings before interest, taxes,      depreciation and amortization, and minority interest.  Adjusted      EBITDA is a non-GAAP measure and should not be considered as an      alternative to any measure of performance as promulgated under accounting      principles generally accepted in the United States nor should it be      considered as an indicator of our overall financial      performance.  We use Adjusted EBITDA as a supplemental measure      of performance as we believe it gives investors a more complete      understanding of our operating results before the impact of financing      activities as a tool for determining the private market value of an      enterprise. |

----

|                                                                         |   | Nine      Months Ended September 30, |          |
|------------------------------------------------------------------------------|--------|--------------------------------------|---------------|
|                                                                         |   | 2008                                 |          |   | 2007 |   |
| Cash      flows (used in) provided by:                                       |   | (in      thousands)                  |          |
|    Operating      activities                                  |   | $                                    | 54,166        |   |   | $ | 202,532 |   |
|    Investing      activities                                  |   |                                 | 7,429         |   |   |   | (23,300 | ) |
|    Financing      activities                                  |   |                                 |  (64,718 | ) |   |   | (121,483 | ) |
|    (Decrease) Increase                              |   |                                 | (3,123        | )  |   |   | 57,749 |   |
|    Effect      of exchange rates on cash and cash equivalents |   |                                 |  (98     | )  |   |   | 31 |   |
|    Cash      and cash equivalents at beginning of period      |   |                                 |  168,319 |   |   |   | 138,113 |   |
|    Cash      and cash equivalents at end of period            |   | $                                    | 165,098       |   |   | $ | 195,893 |   |

----

| -   | Level      1 inputs utilize quoted prices (unadjusted) in active markets for      identical assets or liabilities.                                                                                                                                                                                                                                                                                                                                              |
|---------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| -   | Level      2 inputs utilize inputs other than quoted prices included in Level 1 that      are observable for the asset or liability, either directly or indirectly.      Level 2 inputs include quoted prices for similar assets and liabilities in      active markets and inputs other than quoted prices that are observable for      the asset or liability, such as interest rates and yield curves that are      observable at commonly-quoted intervals. |
| -   | Level      3 inputs are unobservable inputs for the asset or liability, and include      situations where there is little, if any, market activity for the asset or      liability.                                                                                                                                                                                                                                                                        |

SFAS No. 142 
, "Goodwilland Other Intangible Assets". Statement 142-3is effective for financial statements issued for fiscal years beginningafter December 15, 2008, and interim periods within those fiscal years. Earlyadoption is prohibited. The Company plans to adopt this statement on January 1,2009. Statement 142-3 is applicable to the Company however, the effect of itsadoption is not expected to be material.

|                                                   |   | Fair      Value |   |   | Fair      Value assuming 10% decrease in equity prices |    |   | Fair      Value assuming 10% increase in equity prices |   |
|--------------------------------------------------------|--------|-----------------|--------|--------|--------------------------------------------------------|---------|--------|--------------------------------------------------------|--------|
| At      September 30, 2008:                            |   |            |   |   |                                                   |    |   |                                                   |   |   |   |   |
| Equity      price sensitive investments, at fair value |   |  $         | 349.0  |   |                                                   | $  | 314.1  |                                                   |   | $  | 383.9 |   |

----

----

|  Item 2. |  Changes in Securities, Use of      Proceeds and Issuer Purchases of Equity  Securities                                                                                    |
|---------------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
|          |                                                                                                                                                                            |
|          |  The      following table provides information with respect to the repurchase of      Class A Common Stock of GAMCO during the three months ended September 30,      2008: |

|  Period                                                                                                                                                                                                                           |   | (a)      Total Number of Shares Repurchased |    |  (b)      Average Price Paid Per Share, net of Commissions |                                             |  (c)      Total Number of Shares Repurchased as Part of Publicly Announced Plans or      Programs |    | (d)      Maximum Number of Shares That May Yet Be Purchased Under the Plans or      Programs |      |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------|---------|-----------------------------------------------------------------|--------------------------------------------------|--------------------------------------------------------------------------------------------------------|---------|----------------------------------------------------------------------------------------------|-----------|--------|
| 7/01/08      – 7/31/08                                                                                                                                                                                                           |   |                                        | 227,100 |                                                            |             $43.30 |                                                                                                   | 227,100 |                                                                                         | 681,636   |   |   |
| 8/01/08      – 8/31/08                                                                                                                                                                                                           |   |                                        | 17,200  |                                                            | $47.04                                           |                                                                                                   | 17,200  |                                                                                         | 1,064,436 |   |   |
| 9/01/08      – 9/30/08                                                                                                                                                                                                           |   |                                        | 2,500   |                                                            | $47.14                                           |                                                                                                   | 2,500   |                                                                                         | 1,061,936 |   |   |
| Totals                                                                                                                                                                                                                                 |   |                                        | 246,800 |                                                            |                                             |                                                                                                   | 246,800 |                                                                                         |      |   |   |
|                                                                                                                                                                                                                                   |   |                                        |    |                                                            |                                             |                                                                                                   |    |                                                                                         |      |   |   |
| In August 2008, the board of      directors approved an increase of 400,000 shares of GBL available to be      repurchased under our stock repurchase program. Our stock repurchase      programs are not subject to expiration dates. |   |                                        |

|  Item      6.  |   (a) Exhibits |
|--------------------------|-------------------------------|
|                     |                          |

|   | 31.1 | -- | Certification      of CEO pursuant to Rule 13a-14(a). |
|--------|------|----|-------------------------------------------------------|

|   | 31.2 | -- | Certification      of CFO pursuant to Rule 13a-14(a). |
|--------|------|----|-------------------------------------------------------|

|   | 32.1 | -- | Certification      of CEO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section      906 of the Sarbanes-Oxley Act of2002. |
|--------|------|----|-----------------------------------------------------------------------------------------------------------------------------------------|

|   | 32.2 | -- | Certification      of CFO pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section      906 of the Sarbanes- Oxley Act of2002. |
|--------|------|----|------------------------------------------------------------------------------------------------------------------------------------------|

| By:/s/ Kieran Caterina                 | By:/s/ Diane M.    LaPointe            |
|---------------------------------------------|---------------------------------------------|
| Name: Kieran      Caterina             | Name:  Diane      M. LaPointe     |
| Title:      Co-Principal Accounting Officer | Title:      Co-Principal Accounting Officer |
|                                        |                                        |
| Date:      November 7, 2008                 | Date:      November 7, 2008                 |

----