<PAGE>   1
                                  UNITED STATES
                       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 September 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 No. 0-20802

                                 CELEBRITY, INC.
             (Exact name of registrant as specified in its charter)

            Texas                                         75-1289223
(State or other jurisdiction of                         (I.R.S. Employer
incorporation or organization)                          Identification No.)

                           Physical Delivery Address:
                               4520 Old Troup Road
                               Tyler, Texas 75707

                                Mailing Address:
                                  P.O. Box 6666
                               Tyler, Texas 75711
                                 (903) 561-3981

              (Address, including zip code, of principal executive
         offices and 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
                                       ---   ---

The registrant had 6,307,419 shares of Common Stock, par value $.01 per share,
outstanding as of November 7, 1997.


<PAGE>   2


<TABLE>
<CAPTION>
                         PART I - FINANCIAL INFORMATION
ITEM 1.  FINANCIAL STATEMENTS                                          Page
                                                                       
<S>                                                                     <C>
         Condensed Consolidated Balance Sheets at                      
           September 30, 1997 and June 30, 1997                        
           (Unaudited)...................................................2
                                                                       
         Condensed Consolidated Statements of Income                   
           for the three months ended                                  
           September 30, 1997 and 1996 (Unaudited).......................3
                                                                       
         Condensed Consolidated Statements of Cash                     
           Flows for the three months ended                            
           September 30, 1997 and 1996 (Unaudited).......................4
                                                                       
         Notes to Condensed Consolidated Financial                     
           Statements (Unaudited)........................................5
                                                                       
ITEM 2.  MANAGEMENT'S DISCUSSION AND ANALYSIS OF                       
           FINANCIAL CONDITION AND RESULTS OF                          
           OPERATIONS....................................................6
                                                                       
                           PART II - OTHER INFORMATION                 
                                                                       
ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K................................10
                                                                       
         SIGNATURES......................................................11
</TABLE>                                                               
                                                                       

<PAGE>   3

                         PART I - FINANCIAL INFORMATION

                                 CELEBRITY, INC.
                      Condensed Consolidated Balance Sheets
                             (Dollars in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
               ASSETS
                                                                      September 30,   June 30,
                                                                         1997           1997
                                                                       --------       --------

<S>                                                                    <C>            <C>     
Current assets:
         Cash and cash equivalents                                     $    354       $    530
         Accounts receivable, net                                        16,971         15,620
         Inventories                                                     31,980         30,619
         Other current assets                                             2,593          3,493
                                                                       --------       --------
Total current assets                                                     51,898         50,262
Property, plant and equipment, net                                       11,260         11,522
Other assets                                                              5,536          5,669
                                                                       --------       --------
         Total assets                                                  $ 68,694       $ 67,453
                                                                       ========       ========

   LIABILITIES AND SHAREHOLDERS' EQUITY
Current liabilities:
         Accounts payable                                              $ 11,157       $ 10,405
         Accrued expenses                                                 4,584          3,952
         Current portion of notes payable                                27,391         27,067
                                                                       --------       --------
Total current liabilities                                                43,132         41,424
Notes payable, net of current portion                                     4,838          4,877
                                                                       --------       --------
Total liabilities                                                        47,970         46,301
                                                                       --------       --------
Redeemable common stock                                                     175            175
Shareholders' equity:
         Common stock                                                        63             63
         Paid-in capital                                                 22,505         22,353
         Subscriptions receivable                                          (580)          (442)
         Accumulated deficit                                               (912)          (469)
         Treasury stock, at cost                                           (525)          (525)
         Cumulative translation adjustment                                   (2)            (3)
                                                                       --------       --------
Total shareholders' equity                                               20,549         20,977
                                                                       --------       --------
Commitments and contingencies
         Total liabilities, redeemable common stock and
            shareholders' equity                                       $ 68,694       $ 67,453
                                                                       ========       ========
</TABLE>

     See accompanying notes to Condensed Consolidated Financial Statements.

                                       -2-
<PAGE>   4

                                 CELEBRITY, INC.
                   Condensed Consolidated Statements of Income
                (Dollars in thousands, except per share amounts)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                 Three Months
                                               Ended September 30,
                                            -----------------------
                                              1997           1996
                                            --------       --------

<S>                                         <C>            <C>     
Net sales                                   $ 30,208       $ 31,447
                                            --------       --------
Costs and operating expenses:
         Cost of goods sold                   22,669         23,184
         Selling expenses                      1,347          1,411
         General and administrative            5,139          4,992
         Depreciation and amortization           517            596
                                            --------       --------
Total expenses                                29,672         30,183
                                            --------       --------
Operating income                                 536          1,264
Interest expense, net                           (805)          (851)
Other, net                                        (9)             5
                                            --------       --------
Income (loss) before income taxes               (278)           418
Provision (benefit) for income taxes             165            (67)
                                            --------       --------
Net income (loss)                           $   (443)      $    485
                                            ========       ========
Earnings (loss) per share                   $   (.07)      $    .08
                                            ========       ========

Average common and common
   equivalent shares outstanding               6,310          6,311
                                            ========       ========
</TABLE>

     See accompanying notes to Condensed Consolidated Financial Statements.

                                       -3-
<PAGE>   5

                                 CELEBRITY, INC.
                 Condensed Consolidated Statements of Cash Flows
                             (Dollars in thousands)
                                   (Unaudited)

<TABLE>
<CAPTION>
                                                                   Three Months
                                                                Ended September 30,
                                                              ---------------------
                                                               1997           1996
                                                              -------       -------

<S>                                                           <C>           <C>    
Operating activities:
         Net income (loss)                                    $  (443)      $   485

         Adjustments to reconcile net income
                (loss) to net cash used in operations:
             Depreciation and amortization                        517           596
             Deferred income taxes                                             (190)
         Changes in operating assets and liabilities:
             Accounts receivable                               (1,503)       (4,377)
             Inventories                                       (1,361)        1,592
             Other assets, net                                  1,033           501
             Accounts payable and accrued expenses              1,385          (208)
                                                              -------       -------
         Net cash used in operating activities                   (372)       (1,601)
                                                              -------       -------
Investing activities:
         Additions to property and equipment                     (121)         (326)
         Other                                                     18
                                                              -------       -------
         Net cash used in investing activities                   (103)         (326)
                                                              -------       -------
Financing activities:
         Payments on notes payable                               (284)         (936)
         Proceeds from notes payable                              722
         Net proceeds (repayments) under lines of credit         (153)        2,365
         Payments on subscriptions receivable                      14             3
                                                              -------       -------
         Net cash provided by financing activities                299         1,432
                                                              -------       -------
Decrease in cash                                                 (176)         (495)
Cash and cash equivalents, at beginning of period                 530         1,166
                                                              -------       -------
Cash and cash equivalents, at end of period                   $   354       $   671
                                                              =======       =======
</TABLE>

     See accompanying notes to Condensed Consolidated Financial Statements.

                                       -4-
<PAGE>   6

                                 CELEBRITY, INC.

              NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS
                                   (Unaudited)

1.   THE BUSINESS AND BASIS OF PRESENTATION

Description of Business

     Celebrity, Inc. ("Celebrity" or the "Company") is a supplier of high
quality artificial flowers, foliage, flowering bushes, decorative brass products
and other decorative accessories to craft store chains and other specialty
retailers and to wholesale florists throughout North America and Europe.
Celebrity imports and/or produces over 9,000 home accent, decorative accessory
and giftware items, including artificial floral arrangements, floor planters and
trees, a wide range of decorative brass and textile products, and a broad line
of seasonal items such as Christmas trees, wreaths, garlands and other
ornamental products.

Basis of Presentation

     The Condensed Consolidated Financial Statements include the accounts of
Celebrity and its wholly-owned subsidiaries, Celebrity Exports International
Limited ("Celebrity Hong Kong"), The Cluett Corporation ("Cluett"), India
Exotics, Inc. ("India Exotics"), Magicsilk, Inc. ("Magicsilk") and Star
Wholesale Florist, Inc. ("Star Wholesale"). All intercompany accounts and
transactions have been eliminated.

     The accompanying Condensed Consolidated Financial Statements are unaudited,
and in the opinion of management, reflect all adjustments that are necessary for
a fair presentation of the financial position and results of operations for the
periods presented. All such adjustments are of a normal and recurring nature.
The results of operations for the periods presented are not necessarily
indicative of the results to be expected for the entire year. The Condensed
Consolidated Financial Statements should be read in conjunction with the
financial statement disclosures contained in the Company's Annual Report on Form
10-K for the fiscal year ended June 30, 1997.

2.   INVENTORY

     The composition of inventories at September 30, 1997, and June 30, 1997 is
as follows:

<TABLE>
<CAPTION>
                     September 30,       June 30,
                          1997             1997
                       ---------        --------

<S>                    <C>              <C>     
Raw materials          $  11,644        $  8,707
Finished goods            20,336          21,912
                       ---------        --------
                       $  31,980        $ 30,619
                       =========        ========
</TABLE>


                                       -5-
<PAGE>   7

3.   REDEEMABLE COMMON STOCK

     The Company is obligated to repurchase approximately 13,461 shares of its
common stock ("Common Stock") for an aggregate consideration of $175,000. The
repurchase obligation is pursuant to certain put options issued in connection
with the Magicsilk acquisition in 1992. The holders of such put options have
notified the Company of their exercise of the put options with respect to such
shares. Upon the Company's repurchase of such shares, the Company will have
satisfied its repurchase obligations under the put options.

4.   RECENT ACCOUNTING PRONOUNCEMENTS

     In February 1997, Statement of Financial Accounting Standards No. 128,
"Earnings Per Share" ("SFAS 128"), was issued effective for interim and annual
periods ending after December 15, 1997. SFAS 128 establishes new standards for
computing and presenting earnings per share. If the Company had computed
earnings per share in accordance with SFAS 128, basic and diluted earnings
(loss) per share would have been the same as the amounts presented on the
accompanying condensed consolidated statements of operations.

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

CAUTIONARY STATEMENT REGARDING RISKS AND UNCERTAINTIES THAT MAY AFFECT FUTURE
RESULTS

     This Quarterly Report on Form 10-Q contains forward-looking statements
about the business, financial condition and prospects of Celebrity. The actual
results of Celebrity could differ materially from those indicated by the
forward-looking statements because of various risks and uncertainties, including
without limitation (i) changes in customer demand for the Company's products at
the retail level, (ii) trends in the retail and wholesale decorative accessories
industries, (iii) inventory risks attributable to possible changes in customer
demand, compounded by extended lead times in ordering the Company's products
from overseas suppliers and the Company's strategy of maintaining a high
merchandise in stock percentage, (iv) the effects of economic conditions, (v)
supply and/or shipment constraints or difficulties, (vi) the impact of
competitors' pricing, (vii) the effects of the Company's accounting policies,
(viii) changes in foreign trade regulations, including changes in duty rates,
possible trade sanctions, import quotas and other restrictions imposed by U.S.
and foreign governments, (ix) the effects of the assumption of control over Hong
Kong by the People's Republic of China (the "PRC") on July 1, 1997 and (x) other
risks detailed in the Company's Securities and Exchange Commission filings.
These risks and uncertainties are beyond the ability of the Company to control,
and in many cases, the Company cannot predict the risks and uncertainties that
could cause its actual results to differ materially from those indicated by the
forward-looking statements. When used herein, the words "believes", "expects",
"plans" and similar expressions as they relate to the Company or its management
generally are intended to identify forward-looking statements.

                                       -6-
<PAGE>   8

RESULTS OF OPERATIONS

     The following table sets forth certain items in the Condensed Consolidated
Statements of Income of Celebrity expressed as a percentage of net sales for the
periods indicated:

<TABLE>
<CAPTION>
                                                            THREE MONTHS
                                                                ENDED
                                                            SEPTEMBER 30,
                                                     1997                       1996
                                                 -------------         -------------

<S>                                                       <C>                   <C> 
Net sales                                                 100%                  100%
                                                 -------------         -------------
Costs and operating expenses:
         Cost of goods sold                                75%                   74%
         Selling expenses                                   4%                    4%
         General and administrative expenses               17%                   16%
         Depreciation and amortization                      2%                    2%
                                                 -------------         -------------
Total expenses                                             98%                   96%
                                                 -------------         -------------
Operating income (loss)                                     2%                    4%
Interest expense, net                                     (3)%                  (3)%
                                                 -------------         -------------
Income (loss) before income taxes                         (1)%                    1%
Provision (benefit) for income taxes                      (1)%                  (1)%
                                                 -------------         -------------
Net income (loss)                                         (2)%                    2%
                                                 =============         =============
</TABLE>

THREE MONTHS ENDED SEPTEMBER 30, 1997, COMPARED WITH THREE MONTHS ENDED
SEPTEMBER 30, 1996

     Net sales decreased 4% from $31.4 million in fiscal 1997 to $30.2 million
in fiscal 1998. The decrease was primarily attributable to lower sales by the
India Exotics and Cluett subsidiaries. Decreased sales by Cluett relate
primarily to the timing of sales to a major customer that was in the process of
implementing an inventory reduction program.

     Cost of goods sold decreased 2% from $23.2 million in fiscal 1996 to $22.7
million in fiscal 1997. The decrease was primarily attributable to the lower
sales volume in fiscal 1998. Cost of goods sold as a percentage of net sales
remained virtually unchanged at 75% in fiscal 1998 as compared to 74% in fiscal
1997.

     Selling expenses decreased from $1.4 million in fiscal 1997 to $1.3 million
in fiscal 1998. Selling expenses as a percentage of net sales remained unchanged
at 4% in fiscal 1997 and 1998. The decrease in selling expenses was attributable
to the decline in sales volume.

     General and administrative expenses increased from $5.0 million, or 16% of
net sales, in fiscal 1997 to $5.1 million, or 17% of net sales, in fiscal 1998.
The increases in the amount of

                                       -7-
<PAGE>   9

general and administrative expenses were attributable to higher costs of
operating the Star Wholesale location in Dallas, Texas, which opened in May
1997.

     Depreciation and amortization expenses of $517,000 in fiscal 1998 were down
slightly from $596,000 in fiscal 1997. The Company expects, however, that
depreciation and amortization will increase as a result of its continuing
program of upgrading its management information systems.

INFLATION

     The effect of inflation on operating costs has been minimal in recent
years. Most of the Company's operating expenses are inflation sensitive, with
increases in inflation generally resulting in increased costs of operation. The
effect of inflation-driven cost increases on the Company's overall operating
costs is not expected to be greater for the Company than for its competitors.

SEASONALITY

     Celebrity markets and distributes products for all seasons. The shipping
period for each season is relatively long. When combined with shipments of basic
merchandise that is sold year round, there has not been material seasonal or
quarterly fluctuation in net sales or operating income.

LIQUIDITY AND CAPITAL RESOURCES

     Celebrity's sales and marketing strategy and the growth of its business
have required a significantly increased investment in inventory. At the end of
fiscal 1996, however, the Company adopted a strategy to increase inventory
turnover by maintaining its sales growth while carrying reduced levels of
inventory. Inventory levels decreased approximately $1.3 million from $33.3
million at June 30, 1996 to $32.0 million at September 30, 1997. Additionally,
the Company follows the industry practice of offering extended terms to
qualified customers for sales of Christmas merchandise. These sales generally
take place between the months of June and October on terms not requiring payment
until December 1. The Company has traditionally relied on borrowings under its
revolving line of credit and cash flows from operations to fund these and other
working capital needs.

     The Company has a revolving line of credit for its Celebrity, Cluett, India
Exotics and Star Wholesale operations in a maximum amount of $35.0 million. At
September 30, 1997, the outstanding balance on this line of credit was
approximately $26.0 million. Borrowing limits are based on specified percentages
of eligible accounts receivable and inventories and, as a result of such limits,
the maximum amount the Company was eligible to borrow at September 30, 1997, was
$27.0 million. Interest is charged monthly on the daily outstanding balance at
the bank's prime rate of interest plus 3/4% per annum. Amounts borrowed under
the line of credit are secured by accounts receivable and inventory of Celebrity
and its Cluett, India Exotics and Star Wholesale subsidiaries. The line of
credit contains certain covenants limiting the incurrence of indebtedness,
restricting the payment of dividends and requiring the Company to maintain
certain financial ratios. The Company was not in compliance with certain of
these financial covenants at June 30, 1997 and September 30, 1997, specifically
the minimum net worth, debt to equity ratio, EBITDA to interest expense ratio
and minimum net income requirements. Although the Company received waivers for
these

                                       -8-
<PAGE>   10

violations at June 30, 1997, the waivers did not extend to any subsequent
periods. At November 14, 1997 it is uncertain whether the Company will be in
compliance with these covenants at the December 31, 1997 or future quarterly
measurement dates during fiscal 1998. Therefore, the debt has been classified as
a current liability at June 30, 1997 and September 30, 1997, which resulted in
the violation of the current ratio covenant contained in the line of credit
agreement. The Company has not received a waiver for this violation. However,
the Company is presently negotiating a renewal and extension of the line of
credit agreement that would reset the covenants and extend the term beyond June
30, 1998. The lender has provided written assurance to the Company of its intent
to renew and extend the agreement. Management expects the revised line of credit
agreement to be finalized prior to December 31, 1997. There can be no assurance,
however, that negotiations with the lender will be successful.

     Celebrity Hong Kong generally makes full cash payments for products ordered
for Celebrity's account or for direct shipment to customers after the
manufacturers deliver products in Hong Kong for export. Celebrity Hong Kong
finances these cash payments through a credit facility with a Hong Kong bank.
Generally, under the terms of this facility the bank finances, with recourse,
export bills for specific shipments by Celebrity Hong Kong. The bank is
reimbursed when payment for these shipments is received. Under the terms of the
facility, the maximum aggregate amount of Celebrity Hong Kong export bills the
bank is obligated to finance at any time is $5.8 million. At September 30, 1997,
export bills of Celebrity Hong Kong aggregating $7.5 million were being financed
by the bank. All of these bills were related to direct shipments to customers
and Celebrity Hong Kong's related potential recourse liability was accounted for
as a contingent obligation.

     In June 1997, the Company entered into a new revolving credit facility with
an additional bank, which matures in June 2004. Under the new credit facility,
the maximum amount the lender is obligated to lend to the Company is $4.9
million. At September 30, 1997, the outstanding balance under this facility was
approximately $5.0 million. Interest accrues on the principal amount outstanding
under the facility at the rate of LIBOR plus 2.65% per annum. Amounts borrowed
under the facility are secured by certain real estate owned by the Company, and
the facility contains covenants requiring the Company to maintain certain
financial ratios. While the Company was not in compliance with certain of these
financial covenants at June 30, 1997, it has obtained a waiver from the bank
with respect to such noncompliance through June 30, 1998. The Company used
proceeds from this new facility to repay the $4.6 million of indebtedness
outstanding under a $5.0 million loan with a different bank.

     In September 1997, Celebrity borrowed $500,000 from RHP Management, LLC, an
entity controlled by Robert H. Patterson, Jr., President and Chief Executive
Officer of the Company. All amounts outstanding under the promissory note are
due and payable on December 9, 1997. The principal amount outstanding accrues
interest at a fluctuating rate per annum equal to the prime rate of a specified
bank plus 1.5%. The proceeds from this loan were used to pay certain
intercompany accounts payable to Celebrity Hong Kong.

     The Company does not plan to make any significant capital expenditures in
fiscal 1998 other than those incurred in the normal course of business for
replacement of transportation and warehouse equipment and those in connection
with the Company's continuing program to upgrade its management information
systems.

     The Company's business is subject to U.S. law relating to imports,
including those imposing import duties. If the U.S. government were to terminate
most favored nation treatment for the PRC

                                       -9-
<PAGE>   11

or impose punitive tariff rates on products imported by the Company in
retaliation for market access barriers in the PRC, the duty on products imported
by the Company from the PRC would increase significantly. If the Company were to
face an increase in tariff rates on the products it imports into the U.S., it
would (i) attempt to increase the prices charged to its customers, (ii) ask its
suppliers to reduce the prices charged to the Company and (iii) seek to identify
more favorable sources; however, unless and until these efforts were successful,
the Company's results of operations could be affected adversely.

     The Company believes that its current financial position and cash flows
from operations, plus borrowings under its credit facilities, once negotiated as
described above, will be adequate to fund its operations and expansion plans for
the foreseeable future. There is no assurance, however, that these sources will
be sufficient to fund its operations and expansion plans or that any necessary
additional financing will be available, if at all, in amounts required or on
terms satisfactory to the Company.

                           PART II - OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K.

(a)      Exhibits:

27.1              Financial Data Schedule. (1)

(b)      Reports on Form 8-K:

         None.


-----------------
(1)      Filed only with EDGAR version.


                                      -10-
<PAGE>   12

                                   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.


                                       CELEBRITY, INC.



Dated:  November 14, 1997              By /s/ Robert H. Patterson, Jr
                                         -----------------------------------
                                         Robert H. Patterson, Jr.
                                          Chairman of the Board, President and
                                           Chief Executive Officer




                                      -11-
<PAGE>   13

                                 EXHIBIT INDEX

<TABLE>
<CAPTION>
Exhibit
Number                Description                                   Page
------                -----------                                   ----
<S>         <C>
  27.1      Financial Data Schedule. (1)
</TABLE>


-------------
(1)      Filed only with EDGAR version.