<PAGE>   1


                      SECURITIES AND EXCHANGE COMMISSION
                            WASHINGTON, D.C. 20549


                                  FORM 10-Q


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

                 For the quarterly period ended June 30, 1997

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

                  For the transition period from ______ to ______

                        Commission File Number 1-8941

                           FRUIT OF THE LOOM, INC.
            (Exact name of registrant as specified in its charter)



                DELAWARE                                   36-3361804
    (State or other jurisdiction of                     (I.R.S. Employer
    incorporation or organization)                     Identification No.)



                              5000 SEARS TOWER,
                           233 SOUTH WACKER DRIVE,
                           CHICAGO, ILLINOIS 60606
         (Address of principal executive offices, including Zip Code)

                                (312) 876-1724
             (Registrant's telephone number, including area code)

Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days.

                                 Yes  X  No __

Common shares outstanding at July 25, 1997:  67,490,795 shares of Class A
Common Stock, $.01 par value, and 5,790,576 shares of Class B Common Stock,
$.01 par value.




<PAGE>   2

                   FRUIT OF THE LOOM,INC. AND SUBSIDIARIES

                                    INDEX
                                    -----


PART I.  FINANCIAL INFORMATION                                          PAGE NO.


         Item 1.   Financial Statements

                   Condensed Consolidated Balance Sheet;
                        June 30, 1997 (Unaudited) and
                        December 31, 1996                                   2


                   Condensed Consolidated Statement of
                        Earnings (Unaudited); Three and Six
                        Months Ended
                        June 30, 1997 and 1996                              3

                   Condensed Consolidated Statement of Cash Flows
                        (Unaudited); Six Months Ended
                        June 30, 1997 and 1996                              4

                   Notes to Condensed Consolidated Financial Statements
                        (Unaudited)                                         5


         Item 2.   Management's Discussion and Analysis of Financial
                        Condition and Results of Operations                 11



PART II. OTHER INFORMATION

         Item 4.   Submission of Matters to a Vote of Security Holders      18

         Item 6.   Exhibits and Reports on Form 8-K                         19





<PAGE>   3


                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                     CONDENSED CONSOLIDATED BALANCE SHEET
                          (In thousands of dollars)


<TABLE>
<CAPTION>
                                                                           JUNE 30,     DECEMBER 31,
                                                                            1997           1996
                                                                         -----------   -------------
ASSETS                                                                   (UNAUDITED)
------
<S>                                                                      <C>           <C>
Current Assets
   Cash and cash equivalents (including restricted cash)...........      $   21,800    $   18,700
   Notes and accounts receivable (less allowance for possible
       losses of $26,200 and $20,600, respectively)................         312,600       167,300
   Inventories
       Finished goods..............................................         468,800       396,800
       Work in process.............................................         195,700       176,700
       Materials and supplies......................................          58,600        44,500
                                                                         -----------   -------------
           Total inventories.......................................         723,100       618,000
   Other...........................................................          39,700        38,100
                                                                         -----------   -------------
               Total current assets................................       1,097,200       842,100
                                                                         -----------   -------------

Property, Plant and Equipment......................................       1,552,900     1,541,000
   Less accumulated depreciation...................................         692,400       641,100
                                                                         -----------   -------------
               Net property, plant and equipment...................         860,500       899,900
Other Assets                                                             -----------   -------------
   Goodwill (less accumulated amortization of
       $297,900 and $284,500, respectively)........................         730,900       744,300
   Other...........................................................          78,400        60,700
                                                                         -----------   -------------
               Total other assets..................................         809,300       805,000
                                                                         -----------   -------------
                                                                         $2,767,000    $2,547,000
                                                                         ===========   =============

LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------
Current Liabilities
   Current maturities of  long-term debt...........................      $   18,000    $   18,200
   Trade accounts payable..........................................         149,300       111,900
   Other accounts payable and accrued expenses.....................         192,100       196,600
                                                                         -----------   -------------
               Total current liabilities...........................         359,400       326,700
Noncurrent Liabilities                                                   -----------   -------------

   Long-term debt..................................................       1,155,400       867,400
   Deferred income taxes...........................................          20,900        16,900
   Other...........................................................         259,100       271,200
                                                                         -----------   -------------
               Total noncurrent liabilities........................       1,435,400     1,155,500
                                                                         -----------   -------------
Common Stockholders' Equity........................................         972,200     1,064,800
                                                                         -----------   -------------
                                                                         $2,767,000    $2,547,000
                                                                         ===========   =============
</TABLE>

                            See accompanying notes.




                                       2

<PAGE>   4
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

           CONDENSED CONSOLIDATED STATEMENT OF EARNINGS (UNAUDITED)
                    (In thousands, except per share data)




<TABLE>
<CAPTION>
                                                     THREE MONTHS ENDED              SIX MONTHS ENDED
                                                          JUNE 30,                       JUNE 30,
                                                   ----------------------       --------------------------
                                                     1997          1996            1997            1996
                                                   --------      --------       ----------      ----------
<S>                                                <C>           <C>            <C>             <C>        
Net sales................................          $640,700      $732,200       $1,141,700      $1,238,400 
                                                                                                           
Cost of sales............................           469,500       523,400          829,900         892,600 
                                                   --------      --------       ----------      ---------- 
  Gross earnings.........................           171,200       208,800          311,800         345,800 
                                                                                                           
Selling, general and                                                                                       
  administrative expenses................           107,200       100,400          190,900         180,700 
Goodwill amortization....................             6,700         6,700           13,400          13,400 
                                                   --------      --------       ----------      ---------- 
  Operating earnings.....................            57,300       101,700          107,500         151,700 
                                                                                                           
Interest expense.........................           (21,100)      (27,200)         (40,000)        (54,400)
Other expense - net......................            (4,200)       (1,000)          (6,000)         (2,900)
                                                   --------      --------       ----------      ---------- 
  Earnings before income tax expense.....            32,000        73,500           61,500          94,400 
                                                                                                           
Income tax expense.......................             8,800        25,700           17,100          34,100 
                                                   --------      --------       ----------      ---------- 
  Net earnings...........................          $ 23,200      $ 47,800       $   44,400      $   60,300 
                                                   ========      ========       ==========      ==========
Earnings per common share................          $    .31      $    .63       $      .59      $      .79 
                                                   ========      ========       ==========      ========== 
Average common shares outstanding........            75,200        76,100           75,800          76,100 
                                                   ========      ========       ==========      ==========
</TABLE>







                           See accompanying notes.

                                      3
<PAGE>   5
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                CONDENSED CONSOLIDATED STATEMENT OF CASH FLOWS
                                 (UNAUDITED)
                          (In thousands of dollars)

<TABLE>
<CAPTION>
                                                                           SIX MONTHS ENDED
                                                                               JUNE 30,    
                                                                       -----------------------
                                                                          1997         1996   
                                                                       ---------     ---------
<S>                                                                    <C>           <C>
CASH FLOWS FROM OPERATING ACTIVITIES                                                           
   Net earnings...................................................     $  44,400     $  60,300 
   Adjustments to reconcile net earnings to net cash                                           
      used for operating activities:                                                           
      Depreciation and amortization...............................        76,700        74,300 
      Deferred income tax expense.................................         4,000        15,000 
      Increase in working capital.................................      (227,200)     (152,200)
      Other-net...................................................       (28,100)       (8,900)
                                                                       ---------     ---------
         Net cash used for operating activities...................      (130,200)      (11,500)
                                                                       ---------     ---------
CASH FLOWS FROM INVESTING ACTIVITIES                                                           
   Capital expenditures...........................................       (34,500)      (18,500)
   Other-net......................................................        (2,500)      (11,300)
                                                                       ---------     ---------
         Net cash used for investing activities...................       (37,000)      (29,800)
                                                                       ---------     ---------
CASH FLOWS FROM FINANCING ACTIVITIES                                                           
   Proceeds from issuance of long-term debt.......................             -        63,000 
   Proceeds under line-of-credit agreements.......................       525,100       232,800 
   Payments under line-of-credit agreements.......................      (223,600)     (274,100)
   Principal payments on long-term debt and capital leases........        (4,100)       (8,900)
   Common stock issued............................................        10,900         3,300 
   Common stock repurchased.......................................      (138,000)            - 
                                                                       ---------     ---------
         Net cash provided by financing activities................       170,300        16,100 
                                                                       ---------     ---------
Net increase (decrease) in Cash and cash equivalents (including                                
   restricted cash)...............................................         3,100       (25,200)
Cash and cash equivalents (including restricted cash)                                          
   at beginning of period.........................................        18,700        26,500 
Cash and cash equivalents (including restricted cash)                  ---------     --------- 
   at end of period...............................................     $  21,800     $   1,300 
                                                                       =========     =========
</TABLE>


                           See accompanying notes.





                                      4

<PAGE>   6

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

             NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
             ----------------------------------------------------
                                 (UNAUDITED)
                                 -----------

1.   The condensed consolidated financial statements contained herein should
     be read in conjunction with the consolidated financial statements and
     related notes contained in the Annual Report on Form 10-K of Fruit of the
     Loom, Inc. (the "Company") for the year ended December 31, 1996.  The
     information furnished herein reflects all adjustments (consisting of
     normal recurring adjustments) which are, in the opinion of management,
     necessary for a fair presentation of the results of operations of the
     interim periods.  Operating results for the three and six months ended
     June 30, 1997 are not necessarily indicative of results that may be
     expected for the year ended December 31, 1997.

     The Company uses the last-in, first-out ("LIFO") method of accounting for  
     the majority of inventories for financial reporting purposes.  Interim
     determinations of LIFO inventories are necessarily based on management's
     estimates of year-end inventory levels and costs. Subsequent changes in
     these estimates, including the final year-end LIFO determination, and the
     effect of such changes on earnings are recorded in the interim periods in
     which they occur.

2.   No dividends were declared on the Company's common stock for the six-month
     periods ended June 30, 1997 and 1996.

3.   The Company's effective income tax rate for the first six months of 1997   
     differed from the Federal statutory rate of 35% primarily due to the
     impact of foreign earnings, certain of which are taxed at lower rates than
     in the United States, partially offset by goodwill amortization, a portion
     of which is not deductible for Federal income taxes, and state income
     taxes.  In the first six months of 1996, the Company's effective income
     tax rate differed from the Federal statutory rate primarily due to
     goodwill amortization and state income taxes, partially offset by the
     impact of foreign earnings.

     The most significant difference in both years relates to the impact of     
     undistributed earnings of the Company's foreign subsidiaries, which is
     estimated to reduce the effective income tax rate by 12.8% and 5.0% in
     1997 and 1996, respectively.

4.   In 1995, management announced plans to close certain manufacturing
     operations and to take other actions to reduce costs and improve 
     operations.  As a result, the Company recorded charges of approximately
     $372,900,000 ($287,400,000 after tax) related to impairment writedowns of
     goodwill, costs associated with the closing or realignment of certain
     domestic manufacturing facilities and attendant personnel reductions and
     charges related to inventory writedowns and valuations, foreign operations
     and other corporate issues.  These charges were taken in an effort to
     substantially reduce the Company's cost structure, streamline operations
     and further improve customer service.




                                      5
<PAGE>   7
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
      ------------------------------------------------------------------
                                 (UNAUDITED)
                                 -----------

     During the first quarter of 1997, the Company finalized certain of the
     estimates recorded in connection with the above noted charges.  As a
     result of finalizing these estimates, earnings before income tax expense
     for the first quarter of 1997 increased by $7,500,000.  These amounts were
     substantially offset by additional expenses recorded related to a
     performance share compensation plan for certain executive officers earned
     in the first quarter of 1997.

5.   The Company and its subsidiaries are involved in certain legal proceedings 
     and have retained liabilities, including certain environmental
     liabilities, such as those under the Comprehensive Environmental Response,
     Compensation and Liability Act of 1980, as amended, its regulations and
     similar state statutes ("Superfund Legislation"), in connection with the
     sale of certain discontinued operations, some of which were significant
     generators of hazardous waste.  The Company and its subsidiaries have also
     retained certain liabilities related to the sale of products in connection
     with the sale of certain discontinued operations.  The Company's retained
     liability reserves at June 30, 1997 related to discontinued operations
     consist primarily of certain environmental and product liability reserves
     of approximately $70,600,000.  The Company has recorded receivables
     related to these environmental liabilities of approximately $23,600,000
     which management believes will be recovered from insurance and other
     sources.  Management believes that adequate reserves have been established
     to cover potential claims based on facts currently available and current
     Superfund Legislation.

     Generators of hazardous wastes which were disposed of at offsite locations
     which are now superfund sites are subject to claims brought by state and
     Federal regulatory agencies under Superfund Legislation and by private
     citizens under Superfund Legislation and common law theories.  Since 1982,
     the United States Environmental Protection Agency (the "EPA") has actively
     sought compensation for response costs and remedial action at offsite
     disposal locations from waste generators under the Superfund Legislation,
     which authorizes such action by the EPA regardless of fault, legality of
     original disposal or ownership of a disposal site.  The EPA's activities
     under the Superfund Legislation can be expected to continue during the
     remainder of 1997 and future years.

     In February 1986, the Company completed the sale of stock of its then
     wholly owned subsidiary, Universal Manufacturing Corporation ("Universal")
     to MagneTek, Inc. ("MagneTek").  At the time of the sale there was a suit
     pending against Universal and the Company's predecessor, Northwest
     Industries, Inc. ("Northwest"), by LMP Corporation ("LMP"). The suit (the
     "LMP Litigation") alleged that Universal and Northwest fraudulently
     induced LMP to sell its business to Universal and then suppressed the
     development of certain electronic lighting ballasts in breach of the
     agreement of sale, which required Universal to pay to LMP a percentage of
     the net profits from such business from 1982 through 1986.  Two additional
     plaintiffs, Stevens Luminoptics Partnership and Calmont Technologies,
     Inc., joined the litigation in 1986.  In December 1989 and January 1990, a
     jury returned certain verdicts  against  Universal and also returned
     verdicts in  favor of Northwest and on certain issues in favor of
     Universal.  A judgment totaling $25,800,000, of which $7,500,000
     represented punitive damages, reflecting these verdicts was entered by the
     Alameda County, California Superior Court in January 1990 against
     Universal.





                                      6
<PAGE>   8

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

       NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
       ------------------------------------------------------------------
                                  (UNAUDITED)
                                  -----------

     In April 1992, the California Court of Appeals reversed the $25,800,000
     judgment against Universal and affirmed those verdicts favorable to
     Universal and Northwest.  In July 1992, the California Supreme Court
     denied the plaintiffs' petition for review.  The case was then remanded to
     the trial court.

     Pursuant to the stock purchase agreement (the "Stock Purchase Agreement")
     under which Universal was sold, the Company agreed to indemnify MagneTek
     for a two-year period following the sale of Universal for certain
     contingent liabilities.  MagneTek brought suit against the Company for
     declaratory and other relief in connection with the indemnification under
     the Stock Purchase Agreement.  In April 1992, the Los Angeles County,
     California Superior Court found that the Company was obligated by the
     Stock Purchase Agreement to indemnify MagneTek for any liability that may
     be assessed against MagneTek or Universal in the LMP Litigation and to
     reimburse MagneTek for, among other things, its costs and expenses in
     defending that case.  The court entered a judgment requiring the Company
     to reimburse and indemnify MagneTek in two stages:  currently, to
     reimburse MagneTek for costs of defense and related expenses in the LMP
     Litigation, plus costs of litigating the indemnity case with the Company;
     and at a later date, if and when any liability in the LMP Litigation is
     finally determined or a settlement is reached in that case, to reimburse
     and/or indemnify MagneTek for that amount as well.

     In October 1994, following a retrial of the LMP Litigation, a jury
     returned a verdict of approximately $96,000,000 against Universal.  The
     jury verdict included breach of contract and fraud damages and
     approximately $6,000,000 in punitive damages.  The Company is obligated to
     indemnify Universal for damages incurred in this case.

     Management of the Company believes that the jury's decision is incorrect
     and is contrary to the evidence.  Based on discussions with counsel and on
     other information currently available, management  believes that the court
     committed numerous errors during the trial and, accordingly, that the
     judgment will not stand on appeal. All briefs have been filed and the
     appeal is awaiting oral argument.

     In March 1988, a class action suit entitled Endo, et al. v. Albertine, et
     al. was filed in the United States District Court for the Northern
     District of Illinois (the "District Court") against the Company, its then
     directors, certain of its then executive officers, its then underwriters
     and the Company's current independent auditors in connection with the
     Company's initial public offering of Class A Common Stock and certain debt
     securities in March 1987.  The suit alleges, among other things,
     violations of Federal and state securities laws against all of the
     defendants, as well as breaches of fiduciary duties by the director and
     officer defendants, and seeks unspecified damages.




                                      7
<PAGE>   9

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
      ------------------------------------------------------------------
                                 (UNAUDITED)
                                 -----------

     Motions to dismiss the complaint were filed by all defendants.  In
     December 1990, a magistrate judge recommended that the District Court
     dismiss all of the plaintiffs' claims with prejudice.  In January 1993,
     the District Court adopted in part and rejected in part the magistrate
     judge's recommendation for dismissal of the complaint.  As a result, the
     litigation is continuing as to various remaining counts of the complaint.
     Both the defendants and the plaintiffs filed motions for summary judgment
     which were denied in all material respects.  Management and the Board of
     Directors believe that this suit is without merit and intend to continue
     to vigorously defend against this litigation.

     Management  believes,  based on  information  currently available,  that
     the ultimate resolution of the aforementioned matters will not have a
     material adverse effect on the financial condition or results of
     operations of the Company, but the ultimate resolution of certain of these
     matters, if unfavorable, could be material to the results of operations of
     a particular future reporting period.

     In November 1996, in connection with the sale of a substantial portion of  
     its hosiery operations and related assets, the Company guaranteed the
     purchaser's $10,000,000 subordinated note payable to a bank.  The note
     bears interest at a rate of 7.66% per annum and is due November 2006.

     In June 1994, pursuant to authorization from the Company's Board of
     Directors, the Company guaranteed a loan from a bank in an amount up to
     $12,000,000 to Mr. William Farley, the Company's Chairman and Chief
     Executive Officer.  In exchange for the guarantee the Company receives an
     annual fee from Mr. Farley equal to 1% of the value of the loan covered by
     the guarantee. The guarantee is secured  by a second lien on certain
     shares of the Company held by the bank for other loans made to Mr. Farley.

     The Company has negotiated grants from the governments of the Republic of
     Ireland, Northern Ireland and Germany.  The grants are being used for
     employee training, the acquisition of property and equipment and other
     governmental business incentives such as general employment.  At June 30,
     1997, the Company has a contingent liability to repay, in whole or in
     part, grants received of approximately $49,800,000 in the event that the
     Company does not meet defined average employment levels or terminates
     operations in the Republic of Ireland, Northern Ireland and Germany.




                                      8
<PAGE>   10

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONTINUED)
      ------------------------------------------------------------------
                                 (UNAUDITED)
                                 -----------

     The Company has guaranteed, on an unsecured basis, the repayment of
     certain debt incurred or created by Acme Boot Company, Inc. ("Acme Boot"),
     formerly a wholly-owned subsidiary of the Company, under Acme Boot's bank
     credit facilities (the "Acme Boot Credit Facilities").  Acme Boot is a
     majority owned subsidiary of Farley Inc. ("FI"). Mr. Farley holds 100% of
     the common stock of FI.  At June 30, 1997, the Acme Boot Credit Facilities
     provide for up to approximately $67,000,000 of loans and letters of
     credit. The Acme Boot Credit Facilities are secured by liens on
     substantially all of the assets of Acme Boot and its subsidiaries.  At
     June 30, 1997, approximately $63,800,000 in loans and letters of credit
     were outstanding under the Acme Boot Credit Facilities.

     Summarized unaudited financial information for Acme Boot follows (in
     thousands of dollars):


     CONDENSED BALANCE SHEET


<TABLE>
<CAPTION>
                                                 JUNE 30,        DECEMBER 31,   
                                                   1997             1996        
                                               -----------       -----------    
           <S>                                 <C>               <C>            
           Current assets                      $    29,100       $    30,400 
           Noncurrent assets                         3,200             1,600 
                                               -----------       ----------- 
                                               $    32,300       $    32,000 
                                               ===========       =========== 
                                                                             
           Current liabilities                 $    75,400       $    11,400 
           Noncurrent liabilities                   10,500            68,400 
           Preferred stock                           3,800             3,400 
           Common stockholders' deficit            (57,400)          (51,200)
                                               -----------       ----------- 
                                               $    32,300       $    32,000 
</TABLE>                                       ===========       =========== 



     CONDENSED STATEMENT OF OPERATIONS

<TABLE>
<CAPTION>

                                 THREE MONTHS ENDED          SIX MONTHS ENDED
                                      JUNE 30,                    JUNE 30,
                               ---------------------      ---------------------
                                 1997        1996           1997         1996
                               ---------    --------      --------    ---------
           <S>                 <C>          <C>           <C>         <C>
           Net sales            $12,300      $19,200       $23,400     $41,900 
                               =========    ========      ========    =========
           Gross earnings       $ 2,000      $ 5,300       $ 4,100     $11,700 
                               =========    ========      ========    =========
           Operating loss      ($ 1,800)    ($ 2,900)     ($ 3,200)   ($ 5,100)
                               =========    ========      ========    =========
           Net loss            ($ 3,000)    ($ 4,300)     ($ 5,800)   ($ 5,400)
                               =========    ========      ========    =========
</TABLE>



                                      9
<PAGE>   11

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

      NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS - (CONCLUDED)
      ------------------------------------------------------------------
                                 (UNAUDITED)
                                 -----------

     As a result of the Acme Boot operating performance and management's
     assessment of existing facts and circumstances of Acme Boot's financial
     condition, the Company recorded a $35,000,000 charge in 1996 related to
     the Company's evaluation of its exposure under the Acme Boot guarantees.

     In August 1994, the Company acquired Pro Player, Inc. ("Pro Player") for
     approximately $55,700,000 including approximately $14,200,000 of Pro
     Player debt which was repaid by the Company.  The principals of Pro
     Player, who are also key employees of that business, may also be entitled
     to receive compensation of varying amounts in 1999 and 2000 up to a
     maximum of $47,100,000 combined, based in part on the attainment of
     certain levels of operating performance by the acquired entity.

6.   In February 1997, the Financial Accounting Standards Board issued
     Statement of Financial Accounting Standards No. 128 ("Statement No. 128"),
     Earnings per Share, which is required to be adopted on December 31, 1997.
     At that time, the Company will be required to change the method currently
     used to compute earnings per share and to restate all prior periods.
     Statement No. 128 is not expected to have any impact on the Company's
     computation of primary earnings per share as the dilutive effect of common
     stock equivalents is less than the 3% dilution materiality threshold for
     inclusion in primary earnings per share.  The Company does expect to have
     to include a computation of diluted earnings per share in future periods
     for the effect of common stock equivalents which did not meet the 3%
     dilution materiality threshold in prior periods.  The impact is expected
     to result in diluted earnings per common share for the second quarter and
     six months ended June 30, 1997 of $.01 and $.02 less than reported
     earnings per common share.

     In June 1997, the Financial Accounting Standards Board issued Statement of
     Financial Accounting Standards No. 131 ("Statement No. 131"), Disclosures
     about Segments of an Enterprise and Related Information, which is required
     to be adopted for years beginning after December 15, 1997. Statement No.
     131 requires that companies disclose segment data based on how management
     makes decisions about allocating resources to segments and measuring their
     performance.  The Company is currently evaluating the requirements of
     Statement No. 131.

     Effective January 1, 1997, the Company adopted Statement of Financial
     Accounting Standards No. 125 ("Statement No. 125"), Accounting for
     Transfers and Servicing of Financial Assets and Extinguishments of
     Liabilities, which requires an entity to recognize the financial and
     servicing assets it controls and the liabilities it has incurred and to
     derecognize financial assets when control has been surrendered in
     accordance with the criteria provided in Statement No. 125.  Adoption of
     Statement No. 125 did not have a material impact on the condensed
     consolidated financial statements.



                                      10
<PAGE>   12


                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                 PART I.  FINANCIAL INFORMATION - (CONTINUED)

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

FORWARD LOOKING INFORMATION

The Company desires to provide investors with meaningful and useful
information. Therefore, this Quarterly Report on Form 10-Q contains certain
statements which describe the Company's beliefs concerning future business
conditions and the outlook for the Company based on currently available
information.  Wherever possible, the Company has identified these "forward
looking" statements (as defined in Section 21E of the Securities Exchange Act
of 1934) by words such as "anticipates," "believes," "estimates," "expects" and
similar expressions.  These forward looking statements are subject to risks and
uncertainties which could cause the Company's actual results, performance and
achievements to differ materially from those expressed in, or implied by, these
statements.  These risks and uncertainties include but are not limited to the
following:  the financial strength of the retail industry (particularly the
mass merchant channel), the level of consumer spending for apparel, demand for
the Company's activewear screenprint products, the competitive pricing
environment within the basic apparel segment of the apparel industry, the
Company's ability to develop, market and sell new products, the Company's
effective income tax rate, the Company's ability to successfully move
labor-intensive segments of the manufacturing process offshore, the success of
planned advertising, marketing and promotional campaigns, international
activities and the outcome of legal proceedings and other contingent
liabilities.  The Company assumes no obligation to update publicly any forward
looking statements, whether as a result of new information, future events or
otherwise.

RESTRUCTURING AND SPECIAL CHARGES

In 1995, management announced plans to close certain manufacturing operations
and to take other actions to reduce costs and improve operations. As a result,
the Company recorded charges of approximately $372,900,000 ($287,400,000 after
tax) related to impairment write-downs of goodwill, costs associated with the
closing or realignment of certain domestic manufacturing facilities and
attendant personnel reductions and charges related to inventory write-downs and
valuations, foreign operations and other corporate issues. These charges were
taken in an effort to substantially  reduce the Company's cost structure,
streamline operations and further improve customer service.

In the second half of 1997, the Company anticipates a further migration of
sewing operations to lower cost, offshore locations along with the realignment
of certain domestic manufacturing operations. On August 7, 1997, the Company
announced plans to close one domestic plant and relocate sewing operations from
five additional domestic facilities, with the termination of approximately
4,800 production and administrative personnel at these facilities. In
conjunction with the 1997 actions, the Company expects to incur costs ranging
from approximately $10,000,000 to $15,000,000 for production inefficiencies,
severance, fringe benefits (principally health insurance representing the net
cost of COBRA), lease termination and other costs. The majority of the costs
incurred are expected to result in cash payments.





                                      11
<PAGE>   13
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                 PART I.  FINANCIAL INFORMATION - (CONTINUED)


ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
           -------------------------------------------------

The following discussion should be read in conjunction with the accompanying
condensed consolidated financial statements and related notes for the period
ended June 30, 1997 and the Company's consolidated financial statements and
related notes contained in the Company's Annual Report on Form 10-K for the
year ended December 31, 1996.

The table below sets forth selected operating data (in millions of dollars and
as percentages of net sales) of the Company.

<TABLE>
<CAPTION>
                                     THREE MONTHS ENDED    SIX MONTHS ENDED
                                         JUNE 30,              JUNE 30,
                                     -------------------  --------------------
                                      1997       1996       1997       1996   
                                     --------   --------  ---------  ---------
     <S>                             <C>        <C>       <C>        <C>  
     Net sales                       $ 640.7    $ 732.2   $1,141.7   $1,238.4 

     Gross earnings                  $ 171.2    $ 208.8   $  311.8   $  345.8 
     Gross margin                       26.7%      28.5%      27.3%      27.9%

     Operating earnings              $  57.3    $ 101.7   $  107.5   $  151.7 
     Operating margin                    8.9%      13.9%       9.4%      12.2%
</TABLE>



NET SALES

Net sales decreased $91,500,000 or 12.5% in the second quarter and $96,700,000
or 7.8% in the first six months of 1997 compared with the same periods of 1996,
due mainly to significantly lower activewear sales in 1997 and the inclusion of
hosiery sales in 1996. The Company sold its hosiery division in November 1996.
Excessive inventories at wholesale activewear accounts combined with widespread
promotional activity in the highly competitive wholesale activewear market were
the principal negative factors. Licensed sportswear and European sales in the
second quarter of 1997 were also less than sales for the same period in 1996.
Retail product sales, before considering 1996 hosiery sales ($34,300,000 second
quarter, $49,800,000 first six months), improved modestly for the second
quarter and first six months of 1997 with sharply higher second quarter sales
of Gitano(R) jeans following significantly favorable first quarter sales of
men's and boys' underwear.  In addition, sales of Wilson(R)* branded products
increased in the second quarter and first six months of 1997 compared to the
comparable periods of 1996.


*WILSON(R) is a registered trademark of Wilson Sporting Goods Company and is
used by the Company under license for the sale of sweatshirts and sweatpants,
T-shirts, shorts and other athletic activewear.


                                      12
<PAGE>   14

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                 PART I.  FINANCIAL INFORMATION - (CONTINUED)

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
           -------------------------------------------------

OPERATING EARNINGS - (CONCLUDED)

GROSS EARNINGS

Gross earnings decreased $37,600,000 or 18.0% in the second quarter and
$34,000,000 or 9.8% in the first six months of 1997 compared with the same
periods of 1996.  Gross margin declined 1.8 percentage points to 26.7% in the
second quarter of 1997 and .6 percentage points to 27.3% for the first six
months of 1997 as compared to the same periods of 1996.  The principal factors
in both 1997 periods were unfavorable activewear volume, pricing and other
related promotional activities.  Unfavorable retail earnings and margin
comparisons reflected promotional pricing in both 1997 periods, and 1996
included earnings from hosiery operations. Sales of closeout and irregular
merchandise also had a negative effect, principally in casualwear. Gross
earnings and margin benefited significantly, however, from incremental offshore
production as offshore costs are lower than costs in the Company's domestic
facilities.

OPERATING EARNINGS

Operating earnings declined $44,400,000 or 43.7% in the second quarter and
$44,200,000 or 29.1% in the first six months of 1997 compared with the same
periods of 1996.  Operating margin dropped 5.0 percentage points to 8.9% in the
second quarter and 2.8 percentage points to 9.4% for the first six months of
1997 compared with 1996.  Gross earnings and margin were lower as noted above,
and the Company has continued to maintain increased advertising and promotion
expenditures and to implement management information systems to meet customer
demand for more sophisticated distribution and inventory control. Consequently,
selling, general and administrative expense increased $6,800,000 or 6.8% in the
second quarter and $10,200,000 or 5.6% in the first six months of 1997 over the
respective 1996 periods.  The six-month period ended June 30, 1997  included
the finalization of certain of the estimates recorded in connection with
the special charges taken in 1995 which reduced selling, general and
administrative expenses by $7,500,000 in the first quarter of 1997.  Additional
expenses of a substantially similar amount, however, were also recorded in the
first quarter of 1997 related to a performance share compensation plan for
certain executive officers. Selling, general and administrative expense was
16.7% of sales in the second quarter and first six months of 1997 compared with
13.7% and 14.6% in the same periods of 1996, respectively.

INTEREST EXPENSE

Interest expense decreased $6,100,000 or 22.4% and $14,400,000 or 26.5% for the
second quarter and first six months of 1997 compared with the same periods of
1996. The decrease was principally attributable to the effect of lower average
debt levels in 1997.   The lower debt levels were due to repayment of debt out
of the Company's positive cash flow from operating activities in the second
half of 1996 (including the sale of accounts receivable) and proceeds from the
sale of the Company's Hosiery division in November 1996.



                                      13
<PAGE>   15

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                 PART I.  FINANCIAL INFORMATION - (CONTINUED)

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
           -------------------------------------------------

OTHER EXPENSE - NET

Other expense for the second quarter and first six months of 1997 included
losses totalling $2,900,000 and $5,500,000 from sales of accounts receivable.
Accounts receivable were not sold during second quarter and first six months of
1996.

INCOME TAXES

The Company's effective income tax rate for the first six months of 1997
differed from the Federal statutory rate of 35% primarily due to the impact of
foreign earnings, certain of which are taxed at lower rates than in the United
States, partially offset by goodwill amortization, a portion of which is not
deductible for Federal income taxes, and state income taxes.  In the first six
months of 1996, the Company's effective income tax rate differed from the
Federal statutory rate primarily due to goodwill amortization and state income
taxes, partially offset by the impact of foreign earnings.

The most significant difference in both years relates to the impact of
undistributed earnings of the Company's foreign subsidiaries, which is
estimated to reduce the effective income tax rate by 12.8% and 5.0% in 1997 and
1996, respectively.

EARNINGS PER COMMON SHARE

In 1997, earnings per common share were $.31 and $.59 for the second quarter
and first six months compared to $.63 and $.79 for the respective 1996 periods.

LIQUIDITY AND CAPITAL RESOURCES

Funds generated from the Company's operations are the major source of liquidity
and are supplemented by funds obtained from capital markets including bank
facilities.  The Company has available for the funding of its operations
approximately $643,100,000 from revolving lines of credit. As of July 25, 1997,
approximately $172,800,000 was available and unused under these facilities.

Net cash used for operating activities for the six months ended June 30, 1997
and 1996 was $130,200,000 and $11,500,000.  The unfavorable year-to-year
comparison largely resulted from a greater increase in working capital in 1997
($227,200,000 as compared with $152,200,000 in the 1996 period).  Working
capital was much higher at December 31, 1995 than at December 31, 1996, and
therefore 1996 required a smaller seasonal increase than 1997.  The working
capital increase in 1997 was primarily driven by higher accounts receivable
($145,300,000) and inventories ($105,100,000) partially offset by higher trade
payables ($37,400,000).  In 1996, an increase in receivables ($234,100,000) was
partially offset by lower inventories ($24,200,000) and higher trade payables
($17,900,000).  These increases in 1997 and 1996 reflected the seasonality of
the Company's business as it enters its peak selling season.



                                      14
<PAGE>   16

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                 PART I.  FINANCIAL INFORMATION - (CONTINUED)

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONTINUED)
           -------------------------------------------------

LIQUIDITY AND CAPITAL RESOURCES - (CONCLUDED)

Net cash used for investing activities in the six months ended June 30, 1997
and 1996 was $37,000,000 and $29,800,000, respectively.  Capital expenditures
were $34,500,000 and $18,500,000 in the first six months of 1997 and 1996,
respectively.  Capital spending, primarily to enhance finished cloth
manufacturing capabilities and to establish and support offshore assembly
operations, is anticipated to approximate $75,000,000 in 1997.

Net cash provided by financing activities in the six months ended June 30, 1997
and 1996 was $170,300,000 and $16,100,000, respectively.  In 1997, cash
provided by financing activities consisted principally of net borrowings under
the Company's revolving lines of credit partially offset by stock repurchased.
Total long-term debt was $1,173,400,000 at June 30, 1997, down $278,200,000
from June 30, 1996. In 1996, cash provided by financing activities consisted
principally of net proceeds from the issuance of long-term debt, substantially
offset by net payments under the Company's revolving lines of credit.

In November 1996, the Company's Board of Directors authorized the purchase of
up to $200,000,000 of the Company's common stock in open market and privately
negotiated transactions.  Total purchases under the program through June 30,
1997 were 4,333,800 shares at an aggregate cost of $154,600,000.

In December 1996, the Company entered into a three-year receivables purchase
agreement whereby it can sell up to a $200,000,000 undivided interest in a
defined pool of its trade accounts receivable. The maximum amount outstanding
as defined under the agreement varies based upon the level of eligible
receivables.  Under the agreement, approximately $200,000,000 of trade accounts
receivable had been sold at June 30, 1997 and December 31, 1996.  The proceeds
were used to reduce amounts outstanding under the Company's revolving lines of
credit.

In September 1994, the Company entered into a five year operating lease
agreement, with two annual renewal options, primarily for certain machinery and
equipment.  The total cost of the assets to be covered by the lease is limited
to $175,000,000.  At June 30, 1997, approximately $30,400,000 was available and
unused under this facility.  The lease provides for a substantial residual
value guarantee by the Company at the termination of the lease and includes
purchase and renewal options at fair market values.



                                      15
<PAGE>   17
                                      
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
                                      
                 PART I.  FINANCIAL INFORMATION - (CONCLUDED)

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONCLUDED)
           -------------------------------------------------

LIQUIDITY AND CAPITAL RESOURCES - (CONCLUDED)

On July 11, 1997, the Company filed with the Securities and Exchange Commission
a shelf registration statement on Form S-3 (the "Registration Statement") to
register under the Securities Act of 1933, as amended, the sale of up to
$850,000,000 of its debt securities, preferred stock and Class A Common Stock
(collectively, the "Securities").  The Registration Statement does not relate
to any particular offering of Securities; rather, the Registration Statement
was filed to provide the Company with the flexibility to engage in future
offerings without the delay which could result from the filing of new
registration statements at that time.  The types of Securities offered, and
their terms, will be determined prior to any particular offering.  The Company
does not currently have specific plans for the use of the net proceeds from the
future sale of the Securities but anticipates that any such net proceeds would
be used for general corporate purposes, including, but not limited to, working
capital, capital expenditures, expansion of existing properties, development of
new projects, prepayment of outstanding indebtedness, investments and
acquisitions.

Management believes the funding available to the Company is sufficient to meet
anticipated requirements for capital expenditures, working capital and other
needs.  The Company's debt instruments, principally its bank agreements,
contain covenants restricting the Company's ability to sell assets, incur debt,
pay dividends and make investments and require the Company to maintain certain
financial ratios.

NEW ACCOUNTING PRONOUNCEMENTS

In February 1997, the Financial Accounting Standards Board issued Statement of  
Financial Accounting Standards No. 128 ("Statement No. 128"), Earnings per
Share, which is required to be adopted on December  31, 1997.  At that time,
the Company will be required to change the method currently used to compute
earnings per share and to restate all prior periods.  Statement No. 128 is not
expected to have any impact on the Company's computation of primary earnings
per share as the dilutive effect of common stock equivalents is less than the
3% dilution materiality threshold for inclusion in primary earnings per share.
The Company does expect to have to include a computation of diluted earnings
per share in future  periods for the effect of common stock equivalents which
did not meet the 3% dilution materiality threshold in prior periods.  The
impact is expected to result in diluted earnings per common share for the
second quarter and first six months of 1997 of $.01 and $.02 less than reported
earnings per common share.

In June 1997, the Financial Accounting Standards Board issued Statement of
Financial Accounting Standards No. 131 ("Statement No. 131"), Disclosures about
Segments of an Enterprise and Related Information, which is required to be
adopted for years beginning after December 15, 1997. Statement No. 131 requires
that companies disclose segment data based on how management makes decisions
about allocating resources to segments and measuring their performance.  The
Company is currently evaluating the requirements of Statement No. 131.




                                      16
<PAGE>   18
                                      
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES
                                      
                 PART I.  FINANCIAL INFORMATION - (CONCLUDED)

ITEM 2.    MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
           -------------------------------------------------
           CONDITION AND RESULTS OF OPERATIONS - (CONCLUDED)
           -------------------------------------------------

NEW ACCOUNTING PRONOUNCEMENTS - (CONCLUDED)

Effective January 1, 1997, the Company adopted Statement of Financial
Accounting Standards No. 125 ("Statement No. 125"), Accounting for Transfers
and Servicing of Financial Assets and Extinguishments of Liabilities, which
requires an entity to recognize the financial and servicing assets it controls
and the liabilities it has incurred and to derecognize financial assets when
control has been surrendered in accordance with the criteria provided in
Statement No. 125. Adoption of Statement No. 125 did not have a material
impact on the condensed consolidated financial statements.




























                                      17
<PAGE>   19

                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                          PART II. OTHER INFORMATION

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

The annual meeting of stockholders was held on May 13, 1997. Three proposals
were submitted to stockholders as described in the Company's Proxy Statement
dated April 7, 1997 and were voted upon and approved by the stockholders at the
meeting.  The table below briefly describes the proposals and results of the
stockholder votes.  A total of 93,360,023 votes, or 90.7% of the possible votes
based on common shares outstanding at the record date, were represented at the
meeting.


<TABLE>
<CAPTION>
                                   VOTES         VOTES                      AUTHORITY      BROKER   
                                 IN FAVOR       OPPOSED       ABSTAIN       WITHHELD      NONVOTES  
                                 --------       -------       -------       --------      --------  
<S>                              <C>          <C>            <C>            <C>           <C>       
Proposal to elect the following
nine directors:
                                                                      
Elected by holders of Class A                                         
Common Stock:                                                         
       Omar Z. Al Askari         59,586,067        -             -           319,076          - 
       Dennis S. Bookshester     59,585,406        -             -           319,737          - 
       Lee W. Jennings           59,586,012        -             -           319,131          - 
                                                                                                
Elected by holders of Class A                                                                   
and Class B Common Stock:                                                                       
       William Farley            93,030,618        -             -           329,405          - 
       Henry A. Johnson          93,038,388        -             -           321,635          - 
       Richard C. Lappin         93,031,544        -             -           328,479          - 
       Larry K. Switzer          93,043,854        -             -           316,169          - 
       A. Lorne Weil             93,041,882        -             -           318,141          - 
       Sir Brian Wolfson         93,043,019        -             -           317,004          - 
                                                                                                
Proposal to approve the                                                                         
Company's 1995 Executive                                                                        
Incentive Compensation                                                                          
Plan, as Amended                                                                                
and Restated                     65,660,543    27,574,037     125,443           -             - 
                                                                                                
Stockholder proposal                                                                            
to redeem stockholder                                                                           
rights previously issued                                                                        
by the Company                   40,674,044    47,513,660     299,960           -         4,872,359
</TABLE>





                                      18

<PAGE>   20
                   FRUIT OF THE LOOM, INC. AND SUBSIDIARIES

                   PART II. OTHER INFORMATION - (CONCLUDED)

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

a. EXHIBITS

4(a)*   $600,000,000 Credit Agreement dated as of August 16, 1993, among the    
        several banks and other financial institutions from time to time
        parties thereto (the "Lenders"), Bankers Trust Company, a New York
        banking corporation, as administrative agent for the Lenders
        thereunder, Chase Manhattan Bank, NationsBank, N.A., The Bank of New
        York and the Bank of Nova Scotia, as co-agents (incorporated herein by
        reference to Exhibit 4.3 to the Company's Registration Statement on
        Form S-3, Reg. No. 33-50567 (the "1993 S-3")).

4(b)*   Subsidiary Guarantee Agreement dated as of August 16, 1993 by each of   
        the guarantors signatory thereto in favor of the beneficiaries referred
        to therein (incorporated herein by reference to Exhibit 4.4 to the 1993
        S-3).

4(c)*   Rights Agreement, dated as of March 8, 1996 between Fruit of the Loom,  
        Inc. and Chase Mellon Shareholder Services, L.L.C., Rights Agent
        (incorporated herein by reference to Exhibit 4(c) to the Company's
        Annual Report on Form 10-K for the year ended December 31, 1995).

27      Financial Data Schedule.



_______________________________

*  Document is available at the Public Reference Section of the Securities and
Exchange Commission, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D. C.
20549 (Commission file No. 1-8941).

The Registrant has not listed nor filed as an Exhibit to this Quarterly Report
certain instruments with respect to long-term debt representing indebtedness of
the Registrant and its subsidiaries which do not individually exceed 10% of the
total assets of the Registrant and its subsidiaries on a consolidated basis.
Pursuant to Item 601(b)(4)(iii) of Regulation S-K, the Registrant agrees to
furnish such instruments to the Securities and Exchange Commission upon
request.

b.  REPORTS ON FORM 8-K
No report on Form 8-K was filed by the Registrant during the quarter ended June
30, 1997.





                                      19

<PAGE>   21

                                   SIGNATURE
                                   ---------


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.

                                        FRUIT OF THE LOOM, INC.
                                        -----------------------
                                             (Registrant)       
       



Date: August  8, 1997                       LARRY K. SWITZER
                                        -----------------------
                                            Larry K. Switzer               
                                    Senior Executive Vice President
                                       and Chief Financial Officer    
                                      (Principal Financial Officer   
                                       and duly authorized to sign    
                                        on behalf of Registrant)       















                                      20