UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549


                                    FORM 10-Q
                Quarterly report pursuant to section 13 or 15 (d)
                     of the Securities Exchange Act of 1934

For the quarter ended September 30, 1996         Commission file number 0-13875


                               LANCER CORPORATION
             (Exact name of registrant as specified in its charter)


                Texas                                                74-1591073
   (State or other jurisdiction of                                (IRS employer
   incorporation or organization)                           identification no.)

 235 West Turbo, San Antonio, Texas                                      78216
(Address of principal executive offices)                            (Zip Code)

       Registrants telephone number, including area code: (210) 344-3071

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 14(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports)  and  (2)  has  been  subject  to such  filing
requirements for the past 90 days.


                  YES         X              NO
                          --------                   --------


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

                                                       Shares outstanding as of
     Title                                                     November 1, 1996

Common stock, par value $.01 per share                                5,813,849




                                       1
<PAGE>

Part I - Financial Information
<TABLE>
<CAPTION>

Item 1 - Financial Statements

                                         LANCER CORPORATION AND SUBSIDIARIES
                                             CONSOLIDATED BALANCE SHEETS

                                                        ASSETS

                                                                       September 30,                   December 31,
                                                                            1996                           1995
                                                                     -------------------            -------------------
                                                                        (Unaudited)

Current assets:
<S>                                                                <C>                            <C>                 
  Cash                                                             $          2,378,746           $            754,352
                                                                     -------------------            -------------------
  Receivables:
    Trade accounts and notes                                                 19,676,794                     14,431,531
    Other                                                                       285,511                        272,214
                                                                     -------------------            -------------------
                                                                             19,962,305                     14,703,745
    Less allowance for doubtful accounts                                        (85,000)                       (85,000)
                                                                     -------------------            -------------------
      Net receivables                                                        19,877,305                     14,618,745
                                                                     -------------------            -------------------
  Inventories (note 2)                                                       27,055,555                     20,031,758
  Prepaid expenses                                                              330,547                        146,776
  Deferred income taxes                                                          64,245                              -
                                                                     -------------------            -------------------
      Total current assets                                                   49,706,398                     35,551,631
                                                                     -------------------            -------------------

Property, plant and equipment, at cost:
  Land                                                                        1,307,663                        977,888
  Buildings                                                                   9,621,070                      7,950,514
  Machinery and equipment                                                    14,746,329                     13,255,089
  Tools and dies                                                              8,382,559                      7,927,246
  Leaseholds, office equipment and vehicles                                   6,220,615                      4,969,712
  Construction in progress                                                    1,974,435                      1,361,906
                                                                     -------------------            -------------------
                                                                             42,252,671                     36,442,355
  Less accumulated depreciation and amortization                            (19,078,069)                   (17,242,089)
                                                                     -------------------            -------------------
    Net property, plant and equipment                                        23,174,602                     19,200,266
                                                                     -------------------            -------------------

Long-term receivables                                                           437,592                        512,388
Intangibles and other assets,
    at cost, less accumulated amortization                                    2,742,101                      2,679,578
                                                                     -------------------            -------------------

                                                                   $         76,060,693           $         57,943,863
                                                                     ===================            ===================
</TABLE>

                  See accompanying notes to consolidated financial statements.



                                       2
<PAGE>

                                         LANCER CORPORATION AND SUBSIDIARIES
                                       CONSOLIDATED BALANCE SHEETS (continued)
<TABLE>
<CAPTION>

                                         LIABILITIES AND SHAREHOLDERS EQUITY


                                                                       September 30,                   December 31,
                                                                            1996                           1995
                                                                     -------------------            -------------------
                                                                        (Unaudited)
Current liabilities:
<S>                                                                <C>                            <C>                 
  Accounts payable                                                 $          7,627,998           $          5,645,063
  Current installments of long-term debt                                        850,000                      1,448,093
  Line of credit with bank (note 3)                                          14,900,000                      7,000,000
  Deferred revenue                                                              365,102                        815,901
  Accrued expenses and other liabilities                                      4,161,989                      2,882,886
  Income taxes payable                                                          183,932                        487,395
                                                                     -------------------            -------------------
    Total current liabilities                                                28,089,021                     18,279,338

Deferred income taxes                                                         1,033,540                        996,409
Other long-term liabilities                                                     790,000                        700,000
Long-term debt, excluding current installments (note 3)                       7,850,000                      5,397,574
Deferred revenue                                                              2,616,092                      1,505,600
                                                                     -------------------            -------------------

    Total liabilities                                                        40,378,653                     26,878,921
                                                                     -------------------            -------------------

Shareholders' equity (note 4):

  Preferred stock, without par value:
   5,000,000 shares authorized, none issued                                           -                              -

  Common stock, $.01 par value:
   10,000,000 shares authorized; 5,813,849 and 3,872,221
   issued and outstanding in 1996 and 1995, respectively                         58,138                         38,722

  Additional paid-in capital                                                  9,856,501                      9,852,713

  Cumulative translation adjustment                                             218,896                              -

  Retained earnings                                                          25,548,505                     21,173,507
                                                                     -------------------            -------------------

    Total shareholders' equity                                               35,682,040                     31,064,942
                                                                     -------------------            -------------------

                                                                   $         76,060,693           $         57,943,863
                                                                     ===================            ===================
</TABLE>

                   See accompanying notes to consolidated financial statements.



                                       3
<PAGE>

                                         LANCER CORPORATION AND SUBSIDIARIES
                                          CONSOLIDATED STATEMENTS OF INCOME
                                                     (Unaudited)
<TABLE>
<CAPTION>

                                                Three Months Ended                            Nine Months Ended
                                       September 30,          September 30,          September 30,         September 30,
                                            1996                  1995                   1996                  1995
                                     -------------------    ------------------     ------------------    ------------------

<S>                                <C>                    <C>                    <C>                   <C>                
Net sales                          $         27,605,585   $        17,375,660    $        76,391,663   $        59,029,816
Cost of sales                                21,191,957            13,700,527             58,343,988            47,223,852
                                     -------------------    ------------------     ------------------    ------------------
    Gross profit                              6,413,628             3,675,133             18,047,675            11,805,964

Selling, general and
  administrative expenses                     4,085,332             2,631,924             10,670,224             7,621,123
                                     -------------------    ------------------     ------------------    ------------------

    Operating income                          2,328,296             1,043,209              7,377,451             4,184,841
                                     -------------------    ------------------     ------------------    ------------------

Other income (expense):
  Interest expense                            (306,971)             (215,072)            (1,114,336)             (733,995)
  Interest and other income, net                303,423               356,138                671,719             1,351,107
                                     -------------------    ------------------     ------------------    ------------------
                                                (3,548)               141,066              (442,617)               617,112
                                     -------------------    ------------------     ------------------    ------------------

    Earnings before income taxes              2,324,748             1,184,275              6,934,834             4,801,953
                                     -------------------    ------------------     ------------------    ------------------

Income tax expense (benefit):
  Current                                       708,353               312,317              2,522,704             1,752,713
  Deferred                                      107,643                58,277                 37,131              (48,020)
                                     -------------------    ------------------     ------------------    ------------------
                                                815,996               370,594              2,559,835             1,704,693
                                     -------------------    ------------------     ------------------    ------------------

    Net earnings                   $          1,508,752   $           813,681    $         4,374,999   $         3,097,260
                                     ===================    ==================     ==================    ==================

Weighted average common and
    common equivalent shares                  6,080,504             6,005,490              6,060,891             5,984,447
                                     ===================    ==================     ==================    ==================

Net earnings per share             $               0.25   $              0.14    $              0.72   $              0.52
                                     ===================    ==================     ==================    ==================
</TABLE>



                 See accompanying notes to consolidated financial statements.




                                       4
<PAGE>

                                         LANCER CORPORATION AND SUBSIDIARIES
                                        CONSOLIDATED STATEMENTS OF CASH FLOWS
                                                     (Unaudited)
<TABLE>
<CAPTION>
                                                                                         Nine Months Ended
                                                                               September 30,             September 30,
                                                                                   1996                      1995
                                                                           ----------------------    ----------------------

Cash flow from operating activities:
<S>                                                                      <C>                       <C>                    
     Net earnings                                                        $             4,374,999   $             3,097,260

     Adjustments to reconcile net earnings to net
       cash (used) provided by operating activities:
        Depreciation and amortization                                                  1,844,980                 1,640,587
        Loss on sale and disposal of assets                                              (15,485)                   12,845
        Cumulative effect of the translation adjustment                                  218,896                         -
        Changes in assets and liabilities:
            Receivables                                                               (5,183,764)               (4,146,840)
            Refundable income taxes                                                            -                   342,981
            Prepaid expenses                                                            (183,771)                  (98,673)
            Inventories                                                               (7,023,797)                3,713,524
            Other assets                                                                 (71,524)                  410,350
            Accounts payable                                                           1,982,935                (1,222,426)
            Accrued expenses                                                           1,279,103                 1,393,055
            Income taxes payable                                                        (303,463)                  150,731
            Deferred revenue                                                             659,693                         -
            Deferred income taxes                                                        (27,114)                  (48,019)
            Other long-term liabilities                                                   90,000                   180,000 
                                                                           ----------------------    ----------------------
Net cash (used) provided by operating activities                                      (2,358,312)                5,425,375
                                                                           ----------------------    ----------------------

Cash flow from investing activities:
        Proceeds from sale of assets                                                      43,625                    19,201
        Acquisition of property, plant and equipment                                  (5,838,456)               (4,865,656)
                                                                           ----------------------    ----------------------
Net cash used in investing activities                                                 (5,794,831)               (4,846,455)
                                                                           ----------------------    ----------------------

Cash flow from financing activities:
        Net (repayment) borrowings under line of credit agreements                     7,900,000                (2,400,000)
        Proceeds from issuance of long-term debt                                       8,301,883                 1,929,000
        Retirement of long-term debt                                                  (6,447,550)               (1,231,225)
        Proceeds from exercise of stock options                                           23,204                    33,496
                                                                           ----------------------    ----------------------
Net cash provided (used) by financing activities                                       9,777,537                (1,668,729)
                                                                           ----------------------    ----------------------
Net (decrease) increase in cash                                                        1,624,394                (1,089,809)
Cash at beginning of year                                                                754,352                 2,102,390
                                                                           ----------------------    ----------------------
Cash at end of period                                                    $             2,378,746   $             1,012,581
                                                                           ======================    ======================
</TABLE>

                  See accompanying notes to consolidated financial statements.


                                       5
<PAGE>

                                         LANCER CORPORATION AND SUBSIDIARIES
                                      NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
                                                     (Unaudited)


1.       Basis of Presentation

All  adjustments  (consisting of normal  recurring  adjustments)  have been made
which are necessary for a fair presentation of financial position and results of
operations.  All intercompany  balances and transactions have been eliminated in
consolidation.  It is suggested that the  consolidated  financial  statements be
read in conjunction with the consolidated financial statements and notes thereto
included in the December 31, 1995 Annual Report on Form 10-K.

Earnings per share are based on the weighted average number of common and common
equivalent  (dilutive  stock  options)  shares  outstanding  each period.  Fully
diluted  earnings per share would not be different  than earnings per common and
common  equivalent  share. On July 9, 1996, the Company effected a three-for-two
stock split  accounted  for as a dividend.  Prior year weighted  average  shares
outstanding and prior year per share amounts have been restated accordingly.

2.       Inventory Components

The  Company  uses the  gross  profit  method  to  determine  cost of sales  and
inventory for interim  periods.  Inventory  components  are  estimated  based on
historical relationships as follows:

<TABLE>
<CAPTION>

                                        September 30,              December 31,
                                            1996                       1995
                                     ----------------           ---------------
<S>                                 <C>                         <C>
 Finished Goods                      $    6,994,323              $   4,558,742
 Work in process                         15,892,664                 11,982,620
 Raw material and supplies                4,168,568                  3,490,396
                                     ----------------           ---------------
                                     $   27,055,555              $  20,031,758
                                     ================            ==============
</TABLE>


3.       Long-term Debt and Line of Credit

On July 15,  1996,  the  Company  entered  into an  agreement  with two banks to
replace  its  existing  credit  agreements  with  $42.5  million  in new  credit
facilities (the Credit Facilities). The terms of the Credit Facilities require
the Company to maintain certain  financial ratios and other covenants.  Advances
bear interest based upon either the London Interbank  Offered Rates (LIBOR) or
upon, and fluctuating with, the lender's prime rate.

4.       Stock Dividends

On May 23, 1996,  the Companys  Board of Directors  authorized a  three-for-two
stock split effected in the form of a dividend to be distributed on July 9, 1996
to  shareholders  of record as of June 25, 1996.  Shareholders  equity has been
restated  to give  retroactive  recognition  to the stock  split in the  current
period by reclassifying  from additional paid-in capital to common stock the par
value of the additional shares arising from the stock dividend.

5.       Subsequent Event

In October 1996,  the Company  invested $2.6 million in Lancer FBD  Partnership,
Ltd., a new joint venture  formed to  manufacture  frozen  beverage  dispensers.
Lancer will own 50% of the joint  venture,  which will be  headquartered  in San
Antonio, Texas.




                                       6
<PAGE>

Item 2 - Managements Discussion and Analysis of Financial Condition and Results
         of Operations

Results of Operations

Comparison of the Three-Month Periods Ended September 30, 1996 and 1995

Net sales for the quarter ended  September 30, 1996 were $27.6 million,  a $10.2
million  (58.9%)  increase  from the $17.4  million for the same period in 1995.
Domestic  and  international  sales in the 1996  period each  increased  by $5.1
million  over  levels of the same  period of 1995.  The  increase  was caused by
stronger demand for most of the Companys  product lines,  plus the inclusion of
Glenn Pleass  Holdings,  Pty,  Ltd.  (GPH),  an  Australian  based  wholly-owned
subsidiary, which was acquired in December 1995.

Gross profit for the third quarter of 1996  increased to $6.4 million  (23.2% of
sales) from $3.7 million  (21.2 % of sales) in the same  quarter last year.  The
increase was caused by the higher sales level and improved profit  margins.  The
improvement  in  profit  margin  was  the  result  of  continued  reductions  in
manufacturing and overhead costs.

Selling,  general,  and  administrative  expenses  were $4.1 million  during the
quarter ended  September 30, 1996, an increase of $1.5 million,  or 55.2%,  from
the third quarter of 1995.  Expenses rose because of higher  activity  levels in
support of higher sales and the inclusion of GPH.

Interest  expense was $307  thousand in the third  quarter of 1996, up from $215
thousand from the 1995 period, reflecting higher average borrowings.

Net earnings for the quarter  ended  September  30, 1996 were $1.5  million,  up
85.4% from the $.8 million earned in the same quarter of 1995.


Comparison of the Nine-Month Periods Ended September 30, 1996 and 1995

Net sales for the nine-month period ended September 30, 1996 were $76.4 million,
an increase of $17.4  million  (29.4%) from $59.0 million for the same period in
1995. The sales growth reflects strong demand for new and existing  products and
the inclusion of GPHs sales.  International  sales were $30.4 million (39.8% of
net sales) in the nine  months  ended  September  30,  1996,  compared  to $18.3
million (31.0% of net sales) for the same period of 1995.

Gross profit for the 1996 period was $18.0 million, up from $11.8 million in the
same period of 1995. The improvement in gross profit was caused by higher sales,
and by a higher profit margin. The profit margin rose to 23.6% in the first nine
months  of  1996  from  20.0%  in the  comparable  period  of  1995,  reflecting
reductions in manufacturing and overhead costs.

Selling,  general,  and administrative  expenses were $10.7 million for the nine
months ended  September  30, 1996, up 40.0% from $7.6 million in the same period
of 1995. This increase  reflects higher selling,  engineering,  and research and
development expenses, and the inclusion of expenses associated with GPH.

Interest expense in the nine-month period of 1996 was $1.1 million, up from $734
thousand  in the same  period of 1995.  Higher  average  borrowings  caused  the
increase in interest expense.

Net earnings for the nine months ended September 30, 1996 were $4.4 million,  up
41.3% from $3.1 million in the same period of 1995.


Liquidity and Capital Resources

Cash used by  operating  activities  was $2.4  million for the nine months ended
September  30, 1996  compared to cash  provided by operating  activities of $5.4
million for the same period of 1995. Growth in inventory and accounts receivable
totaling $12.2 million was the primary use of cash in the 1996 period.  The $2.4
million of cash used by  operating  activities,  together  with $5.8  million of
capital  spending,  was financed  primarily with borrowings  under the Companys
credit facilities. The Company expects cash from operations,  availability under
the credit  facilities,  and cash on hand to be sufficient to fund the Companys
growth for the foreseeable future.
                                       7
<PAGE>

On July 15,  1996,  the  Company  entered  into an  agreement  with two banks to
replace  its  existing  credit  agreements  with  $42.5  million  in new  credit
facilities.  The loans are due in five years, and provide  financing for working
capital  requirements,   potential  acquisitions,   and  for  capital  spending,
including the expansion of the  Companys  facilities in San Antonio,  Texas and
Piedras Negras, Mexico.


Part II - Other Information

Item 1 - Legal Proceedings

The Company is a party to various  lawsuits and claims  generally  incidental to
its business.  In the opinion of management and independent  legal counsel,  the
ultimate  disposition  of these  matters is not  expected to have a  significant
adverse effect on the Companys financial position or results of operations.


Item 5 - Other Information

None









































                                       8
<PAGE>

Item 6 - Exhibits and Reports on Form 8-K

         (a) Exhibits:

              None

         (b)  Reports on Form 8-K

              No reports on Form 8-K have been filed during the fiscal quarter
              for which this report is filed.


SIGNATURES



Pursuant  to the  requirements  of the  Securities  Exchange  Act of  1934,  the
registrant  has duly  caused  this  report  to be  signed  on its  behalf by the
undersigned thereunto duly authorized.



LANCER CORPORATION
(Registrant)




November 11, 1996                    By:  /s/ George F. Schroeder
                                          George F. Schroeder
                                          President and CEO




November 11, 1996                    By:  /s/ John P. Herbots
                                          John P. Herbots
                                          Chief Financial Officer





























                                       9