----

----

| DELAWARE(State or Other Jurisdiction ofIncorporation or Organization)            | 63-0798460(IRS Employer Identification No.) |
|----------------------------------------------------------------------------------|---------------------------------------------|
|                                                                             |                                        |
| 402 Industrial Lane, Birmingham, Alabama(Address of principal executive offices) | 35211(Zip Code)                             |

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BOOKS-A-MILLION, INC. AND SUBSIDIARIES

|     |                                                                                                                           | Page No. |
|----------|--------------------------------------------------------------------------------------------------------------------------------|----------|
| PART I.  | FINANCIAL INFORMATION                                                                                                     |     |
| Item 1.  | Financial Statements (Unaudited)                                                                                          |     |
|     | Condensed Consolidated Balance Sheets as of July 31, 2010 and January 30, 2010                                            | 3        |
|     | Condensed Consolidated Statements of Income for the thirteen and twenty-six weeks ended July 31, 2010 and August 1, 2009  | 4        |
|     | Condensed Consolidated Statement of Changes in Stockholders’ Equity for the twenty-six weeks ended July 31, 2010    | 5        |
|     | Condensed Consolidated Statements of Cash Flows for the twenty-six weeks ended July 31, 2010 and August 1, 2009           | 6        |
|     | Notes to Condensed Consolidated Financial Statements                                                                      | 7        |
| Item 2.  | Management’s Discussion and Analysis of Financial Condition and Results of Operations                               | 16       |
| Item 3.  | Quantitative and Qualitative Disclosures about Market Risk                                                                | 22       |
| Item 4.  | Controls and Procedures                                                                                                   | 22       |
| PART II. | OTHER INFORMATION                                                                                                         |     |
| Item 1.  | Legal Proceedings                                                                                                         | 22       |
| Item 1A. | Risk Factors                                                                                                              | 23       |
| Item 2.  | Unregistered Sales of Equity Securities and Use of Proceeds                                                               | 23       |
| Item 3.  | Defaults Upon Senior Securities                                                                                           | 23       |
| Item 4.  | Reserved                                                                                                                  | 23       |
| Item 5.  | Other Information                                                                                                         | 23       |
| Item 6.  | Exhibits                                                                                                                  | 24       |

----

Index

| Item 1. | Financial Statements |
|---------|----------------------|

BOOKS-A-MILLION, INC. ANDSUBSIDIARIES

|                                                                                                                                                                                                                                                                                                                                                                               |   | July 31, 2010 |     |   | January 30, 2010 |   |
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------|----------|--------|------------------|--------|
| ASSETSCurrent assets:                                                                                                                                                                                                                                                                                                                                                              |   |          |     |   |             |   |
| Cash and cash equivalents                                                                                                                                                                                                                                                                                                                                                          |   | $             | 5,165    |   |             | $      | 6,602 |   |
| Accounts receivable, net                                                                                                                                                                                                                                                                                                                                                           |   |          | 4,640    |   |             |   | 5,211 |   |
| Other receivables                                                                                                                                                                                                                                                                                                                                                                  |   |          | 1,920    |   |             |   | 265 |   |
| Related party receivables                                                                                                                                                                                                                                                                                                                                                          |   |          | 103      |   |             |   | 584 |   |
| Inventories                                                                                                                                                                                                                                                                                                                                                                        |   |          | 203,143  |   |             |   | 201,510 |   |
| Prepayments and other                                                                                                                                                                                                                                                                                                                                                              |   |          | 3,828    |   |             |   | 2,942 |   |
| Total current assets                                                                                                                                                                                                                                                                                                                                                               |   |          | 218,799  |   |             |   | 217,114 |   |
|                                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| Property and equipment                                                                                                                                                                                                                                                                                                                                                             |   |          |     |   |             |   |   |   |
| Gross property and equipment                                                                                                                                                                                                                                                                                                                                                       |   |          | 239,434  |   |             |   | 240,834 |   |
| Less accumulated depreciation and amortization                                                                                                                                                                                                                                                                                                                                     |   |          | (185,486 | )      |             |   | (187,693 | ) |
| Property and equipment, net                                                                                                                                                                                                                                                                                                                                                        |   |          | 53,948   |   |             |   | 53,141 |   |
|                                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| Deferred income taxes                                                                                                                                                                                                                                                                                                                                                              |   |          | 2,743    |   |             |   | 2,200 |   |
| Other assets (Note 13)                                                                                                                                                                                                                                                                                                                                                             |   |          | 3,963    |   |             |   | 1,043 |   |
| Total assets                                                                                                                                                                                                                                                                                                                                                                       |   | $             | 279,453  |   |             | $      | 273,498 |   |
|                                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| LIABILITIES AND STOCKHOLDERS’ EQUITY                                                                                                                                                                                                                                                                                                                                         |   |          |     |   |             |   |   |   |
| Current liabilities:                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| Trade accounts payable                                                                                                                                                                                                                                                                                                                                                             |   | $             | 91,527   |   |             | $      | 88,843 |   |
| Related party accounts payable                                                                                                                                                                                                                                                                                                                                                     |   |          | 3,868    |   |             |   | 1,814 |   |
| Accrued expenses                                                                                                                                                                                                                                                                                                                                                                   |   |          | 33,916   |   |             |   | 36,583 |   |
| Accrued income taxes                                                                                                                                                                                                                                                                                                                                                               |   |          | --       |   |             |   | 4,824 |   |
| Deferred income taxes                                                                                                                                                                                                                                                                                                                                                              |   |          | 11,306   |   |             |   | 10,146 |   |
| Short-term borrowings (Note 9)                                                                                                                                                                                                                                                                                                                                                     |   |          | 14,160   |   |             |   | -- |   |
| Total current liabilities                                                                                                                                                                                                                                                                                                                                                          |   |          | 154,777  |   |             |   | 142,210 |   |
|                                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| Long-term debt (Note 9)                                                                                                                                                                                                                                                                                                                                                            |   |          | --       |   |             |   | 6,360 |   |
| Deferred rent                                                                                                                                                                                                                                                                                                                                                                      |   |          | 8,539    |   |             |   | 8,319 |   |
| Liability for uncertain tax positions                                                                                                                                                                                                                                                                                                                                              |   |          | 1,975    |   |             |   | 1,901 |   |
| Total non-current liabilities                                                                                                                                                                                                                                                                                                                                                      |   |          | 10,514   |   |             |   | 16,580 |   |
|                                                                                                                                                                                                                                                                                                                                                                               |   |          |     |   |             |   |   |   |
| Commitments and contingencies (Note 4)                                                                                                                                                                                                                                                                                                                                             |   |          | --       |   |             |   | -- |   |
| Stockholders’ equity:                                                                                                                                                                                                                                                                                                                                                        |   |          |     |   |             |   |   |   |
| Preferred stock, $0.01 par value, 1,000,000 shares       authorized, no shares outstanding                                                                                                                                                                                                                                                      |   |          | --       |   |             |   | -- |   |
| Common stock, $0.01 par value, 30,000,000         shares authorized, 21,579,198 and 21,269,303        shares issued and 15,640,292 and 15,648,222        shares outstanding at July 31, 2010 and January        30, 2010, respectively |   |          | 216      |   |             |   | 213 |   |
| Additional paid-in capital                                                                                                                                                                                                                                                                                                                                                         |   |          | 92,901   |   |             |   | 92,044 |   |
| Treasury stock at cost (5,938,906 and 5,621,081        shares at July 31, 2010 and January 30, 2010,        respectively)                                                                                                                                                                                    |   |          | (49,477  | )      |             |   | (47,342 | ) |
| Retained earnings                                                                                                                                                                                                                                                                                                                                                                  |   |          | 70,522   |   |             |   | 69,793 |   |
| Total stockholders’ equity                                                                                                                                                                                                                                                                                                                                                   |   |          | 114,162  |   |             |   | 114,708 |   |
| Total liabilities and stockholders’ equity                                                                                                                                                                                                                                                                                                                                   |   | $             | 279,453  |   |             | $      | 273,498 |   |

----

Index

BOOKS-A-MILLION, INC. ANDSUBSIDIARIES

|                                                                                                                                                      |   |                 |    |   |                   |   |
|-----------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------|---------|--------|------------------------|--------|
|                                                                                                                                                      |   | Thirteen Weeks Ended |    |   | Twenty-Six Weeks Ended |   |
|                                                                                                                                                      |   | July 31, 2010        |    |   | August 1, 2009         |   |   | July 31, 2010 |   |   | August 1, 2009 |   |
|                                                                                                                                                      |   |                 |    |   |                   |   |   |   |   |   |   |   |
| Net sales                                                                                                                                                 |   | $                    | 120,048 |   |                   | $      | 122,443 |   |   | $ | 237,016 |   |   | $ | 240,612 |   |
|    Cost of products sold (including warehouse         distribution and store occupancy costs) |   |                 | 83,551  |   |                   |   | 86,321 |   |   |   | 165,345 |   |   |   | 169,213 |   |
| Gross profit                                                                                                                                              |   |                 | 36,497  |   |                   |   | 36,122 |   |   |   | 71,671 |   |   |   | 71,399 |   |
|    Operating, selling and administrative expenses                                                                                          |   |                 | 29,539  |   |                   |   | 29,911 |   |   |   | 57,794 |   |   |   | 58,079 |   |
|    Depreciation and amortization                                                                                                           |   |                 | 3,768   |   |                   |   | 3,604 |   |   |   | 7,331 |   |   |   | 7,187 |   |
| Operating income                                                                                                                                          |   |                 | 3,190   |   |                   |   | 2,607 |   |   |   | 6,546 |   |   |   | 6,133 |   |
|    Interest expense, net                                                                                                                   |   |                 | 157     |   |                   |   | 143 |   |   |   | 279 |   |   |   | 319 |   |
| Income before income taxes                                                                                                                                |   |                 | 3,033   |   |                   |   | 2,464 |   |   |   | 6,267 |   |   |   | 5,814 |   |
|    Income tax provision                                                                                                                    |   |                 | 1,137   |   |                   |   | 956 |   |   |   | 2,367 |   |   |   | 2,247 |   |
| Net income                                                                                                                                                |   | $                    | 1,896   |   |                   | $      | 1,508 |   |   | $ | 3,900 |   |   | $ | 3,567 |   |
|                                                                                                                                                      |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|            Basic earnings per common share                                                         |   | $                    | 0.12    |   |                   | $      | 0.10 |   |   | $ | 0.25 |   |   | $ | 0.23 |   |
|            Diluted earnings per common share                                                       |   | $                    | 0.12    |   |                   | $      | 0.10 |   |   | $ | 0.25 |   |   | $ | 0.23 |   |
| Weighted average common shares outstanding:                                                                                                               |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|            Basic                                                                                   |   |                 | 15,723  |   |                   |   | 15,759 |   |   |   | 15,742 |   |   |   | 15,776 |   |
|            Diluted                                                                                 |   |                 | 15,729  |   |                   |   | 15,768 |   |   |   | 15,749 |   |   |   | 15,782 |   |
|                                                                                                                                                      |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
| Dividends declared per share                                                                                                                              |   | $                    | 0.05    |   |                   | $      | 0.05 |   |   | $ | 0.10 |   |   | $ | 0.10 |   |
|                                                                                                                                                      |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|                                                                                                                                                      |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |

----

Index

BOOKS-A-MILLION, INC. ANDSUBSIDIARIES

|                                                    |   | Common Stock |   |   | Additional Paid-In |   |   | Treasury Stock |   |   | Retained |   |   | Total Stockholders’ |   |
|---------------------------------------------------------|--------|--------------|--------|--------|--------------------|--------|--------|----------------|--------|--------|----------|--------|--------|---------------------------|--------|
|                                                    |   | Shares       |   |   | Amount             |   |   | Capital        |   |   | Shares   |   |   | Amount                    |   |   | Earnings |   |   | Equity |   |
| Balance January 30, 2010                                |   |         | 21,269 |   |               | $      | 213    |           |   | $      | 92,044   |   |   |                      | 5,621  |   |   | $ | (47,342 | ) |   | $ | 69,793 |   |   | $ | 114,708 |   |
| Purchase of treasury stock                              |   |         | --     |   |               |   | --     |           |   |   | --       |   |   |                      | 318    |   |   |   | (2,135 | ) |   |   | -- |   |   |   | (2,135 | ) |
| Net income                                              |   |         | --     |   |               |   | --     |           |   |   | --       |   |   |                      | --     |   |   |   | -- |   |   |   | 3,900 |   |   |   | 3,900 |   |
| Dividends paid                                          |   |         | --     |   |               |   | --     |           |   |   | --       |   |   |                      | --     |   |   |   | -- |   |   |   | (3,171 | ) |   |   | (3,171 | ) |
| Issuance of restricted stock                            |   |         | 271    |   |               |   | 3      |           |   |   | 714      |   |   |                      | --     |   |   |   | -- |   |   |   | -- |   |   |   | 717 |   |
| Issuance of stock for employee stock purchase plan |   |         | 37     |   |               |   | --     |           |   |   | 91       |   |   |                      | --     |   |   |   | -- |   |   |   | -- |   |   |   | 91 |   |
| Tax benefit from stock-based compensation               |   |         | --     |   |               |   | --     |           |   |   |  47 |   |   |                      | --     |   |   |   | -- |   |   |   | -- |   |   |   | 47 |   |
| Exercise of stock options                               |   |         | 2      |   |               |   | --     |           |   |   | 5        |   |   |                      | --     |   |   |   | -- |   |   |   | -- |   |   |   | 5 |   |
| Balance July 31, 2010                                   |   |         | 21,579 |   |               | $      | 216    |           |   | $      | 92,901   |   |   |                      | 5,939  |   |   | $ | (49,477 | ) |   | $ | 70,522 |   |   | $ | 114,162 |   |

----

Index

BOOKS-A-MILLION, INC. ANDSUBSIDIARIES

|                                                                                                                            |   | Twenty-Six Weeks Ended |     |
|---------------------------------------------------------------------------------------------------------------------------------|--------|------------------------|----------|
|                                                                                                                            |   | July 31, 2010          |     |   | August 1, 2009 |   |
| Cash Flows from Operating Activities:                                                                                           |   |                   |     |   |   |   |
| Net income                                                                                                                      |   | $                      | 3,900    |   |   | $ | 3,567 |   |
| Adjustments to reconcile net income to net cash provided by operating activities:                                               |   |                   |     |   |   |   |   |   |
| Depreciation and amortization                                                                                                   |   |                   | 7,331    |   |   |   | 7,187 |   |
| Stock-based compensation                                                                                                        |   |                   | 716      |   |   |   | 613 |   |
| Forfeiture of stock-based compensation                                                                                          |   |                   | --       |   |   |   | (659 | ) |
| Loss on impairment of assets                                                                                                    |   |                   | 81       |   |   |   | 366 |   |
| Loss on sale of property and equipment                                                                                          |   |                   | 138      |   |   |   | 158 |   |
| Deferred income taxes                                                                                                           |   |                   | 617      |   |   |   | 154 |   |
| Excess tax benefit from stock-based compensation                                                                                |   |                   | (47      | ) |   |   | (14 | ) |
| Bad debt expense                                                                                                                |   |                   | 327      |   |   |   | 81 |   |
| (Increase) decrease in assets:                                                                                                  |   |                   |     |   |   |   |   |   |
| Accounts receivable and other receivables                                                                                       |   |                   | (1,407   | ) |   |   | (86 | ) |
| Related party receivables                                                                                                       |   |                   | 481      |   |   |   | 637 |   |
| Inventories                                                                                                                     |   |                   | (1,633   | ) |   |   | (357 | ) |
| Prepayments and other                                                                                                           |   |                   | (886     | ) |   |   | 512 |   |
| Noncurrent assets                                                                                                               |   |                   | 19       |   |   |   | (5 | ) |
| Increase (decrease) in liabilities:                                                                                             |   |                   |     |   |   |   |   |   |
| Accounts payable                                                                                                                |   |                   | 2,684    |   |   |   | 3,608 |   |
| Related party payables                                                                                                          |   |                   | 2,054    |   |   |   | (1,133 | ) |
| Accrued income taxes                                                                                                            |   |                   | (4,703   | ) |   |   | (862 | ) |
| Accrued expenses and deferred rent                                                                                              |   |                   | (2,447   | ) |   |   | 558 |   |
| Total adjustments                                                                                                               |   |                   | 3,325    |   |   |   | 10,758 |   |
| Net cash provided by operating activities                                                                                       |   |                   | 7,225    |   |   |   | 14,325 |   |
|                                                                                                                            |   |                   |     |   |   |   |   |   |
| Cash Flows from Investing Activities:                                                                                           |   |                   |     |   |   |   |   |   |
| Capital expenditures                                                                                                            |   |                   | (8,306   | ) |   |   | (4,348 | ) |
| Proceeds from sale of property and equipment                                                                                    |   |                   | 6        |   |   |   | 84 |   |
| Acquisition of equity method investment (Note 13)                                                                               |   |                   | (3,000   | ) |   |   | -- |   |
| Net cash used in investing activities                                                                                           |   |                   | (11,300  | ) |   |   | (4,264 | ) |
|                                                                                                                            |   |                   |     |   |   |   |   |   |
| Cash Flows from Financing Activities:                                                                                           |   |                   |     |   |   |   |   |   |
| Borrowings under credit facilities                                                                                              |   |                   | 108,630  |   |   |   | 94,880 |   |
| Repayments under credit facilities                                                                                              |   |                   | (100,830 | ) |   |   | (102,960 | ) |
| Proceeds from exercise of stock options and issuance of common stock     under employee stock purchase plan |   |                   | 97       |   |   |   | 113 |   |
| Purchase of treasury stock                                                                                                      |   |                   | (2,135   | ) |   |   | (525 | ) |
| Payment of dividends                                                                                                            |   |                   | (3,171   | ) |   |   | (1,580 | ) |
| Excess tax benefit from stock based compensation                                                                                |   |                   | 47       |   |   |   | 14 |   |
| Net cash provided by (used in) financing activities                                                                             |   |                   | 2,638    |   |   |   | (10,058 | ) |
|                                                                                                                            |   |                   |     |   |   |   |   |   |
| Net (Decrease) Increase in Cash and Cash Equivalents                                                                            |   |                   | (1,437   | ) |   |   | 3 |   |
| Cash and Cash Equivalents at Beginning of Period                                                                                |   |                   | 6,602    |   |   |   | 5,529 |   |
| Cash and Cash Equivalents at End of Period                                                                                      |   | $                      | 5,165    |   |   | $ | 5,532 |   |
|                                                                                                                            |   |                   |     |   |   |   |   |   |
| Supplemental Disclosures of Cash Flow Information:                                                                              |   |                   |     |   |   |   |   |   |
| Cash paid during the period for:                                                                                                |   |                   |     |   |   |   |   |   |
| Interest                                                                                                                        |   | $                      | 273      |   |   | $ | 322 |   |
| Income taxes, net of refunds                                                                                                    |   | $                      | 6,995    |   |   | $ | 3,212 |   |
| Supplemental Disclosures of Non Cash Investing Activities:                                                                      |   |                   |     |   |   |   |   |   |
| Capital expenditures in accrued expenses                                                                                        |   | $                      | 364      |   |   | $ | 684 |   |

----

Index

BOOKS-A-MILLION, INC. AND SUBSIDIARIES

| 1.   | Basis of Presentation |
|----------------|-----------------------|

|                                       |   | Twenty-Six Weeks EndedJuly 31, 2010 |   |
|--------------------------------------------|--------|-------------------------------------|--------|
|                                       |   |                                |   |   | Weighted |   |
|                                       |   |                                |   |   | Average |   |
|                                       |   |                                |   |   | Exercise |   |
|                                       |   | Shares                              |   |   | Price |   |
| Options outstanding at beginning of period |   |                                | 40     |   |   | $ | 5.32 |   |
| Options granted                            |   |                                | --     |   |   |   | N/A |   |
| Options exercised                          |   |                                | (2     | ) |   |   | (2.37 | ) |
| Options forfeited                          |   |                                | (1     | ) |   |   | (5.62 | ) |
| Options outstanding at end of period       |   |                                | 37     |   |   | $ | 5.47 |   |
| Options exercisable at end of period       |   |                                | 37     |   |   | $ | 5.47 |   |

----

Index

|                    |          |   | Options Outstanding                |   |   | Options Exercisable                                 |   |
|-------------------------|---------------|--------|------------------------------------|--------|--------|-----------------------------------------------------|--------|
| Range of Exercise Price |          |   | OptionsOutstanding atJuly 31, 2010 |   |   | Weighted Average Remaining Contractual Life (Years) |   |   | Weighted Average Exercise Price |   |   | OptionsExercisable atJuly 31, 2010 |   |   | Weighted Average Exercise Price |   |
|                    | $1.69 - $2.37 |   |                               |   | 8      |                                                |   |   | 2.25 |   |   | $ | 2.28 |   |   |   | 8 |   |   | $ | 2.28 |   |
|                    | $2.68 - $5.85 |   |                               |   | 6      |                                                |   |   | 1.51 |   |   | $ | 3.04 |   |   |   | 6 |   |   | $ | 3.04 |   |
|                    | $6.13 - $9.62 |   |                               |   | 23     |                                                |   |   | 3.73 |   |   | $ | 7.30 |   |   |   | 23 |   |   | $ | 7.30 |   |
| Totals                  |          |   |                               | 37     |   |                                                |   | 3.02 |   |   | $ | 5.47 |   |   |   | 37 |   |   | $ | 5.47 |   |

|                          |   | Twenty-Six Weeks EndedJuly 31, 2010 |   |
|-------------------------------|--------|-------------------------------------|--------|
|                          |   | Shares                              |   |   | Weighted Average Grant Date Fair Value |   |
| Shares at beginning of period |   |                                | 465    |   |   | $ | 6.28 |   |
| Shares granted                |   |                                | 271    |   |   | $ |     7.27 |   |
| Shares vested                 |   |                                | (13    | ) |   | $ | 9.07 |   |
| Shares forfeited              |   |                                | --     |   |   | $ | -- |   |
| Shares at end of period       |   |                                | 723    |   |   | $ | 6.60 |   |

----

Index

| Fiscal Year |   | Stock-based Compensation Expense |      |
|-------------|--------|----------------------------------|-----------|
| 2011        |   | $                                | 856,777   |   |
| 2012        |   |                             | 1,216,684 |   |
| 2013        |   |                             | 322,504   |   |
| 2014        |   |                             | 5,049     |   |
| Total       |   | $                                | 2,401,014 |   |

| 2.   | Net Income Per Common Share |
|----------------|-----------------------------|

----

Index

|                                                      | Thirteen Weeks Ended   |
|-----------------------------------------------------------|------------------------|
| (in thousands)                                            | July 31, 2010          |   | August 1, 2009 |
| Weighted average shares outstanding:                      |                   |   |   |
| Basic                                                     | 15,723                 |   | 15,759 |
| Dilutive effect of stock options outstanding              | 6                      |   | 9 |
| Diluted                                                   | 15,729                 |   | 15,768 |
|                                                      |                   |   |   |
|                                                      | Twenty-Six Weeks Ended |
|         (in thousands) | July 31, 2010          |   | August 1, 2009 |
| Weighted average shares outstanding:                      |                   |   |   |
| Basic                                                     | 15,742                 |   | 15,776 |
| Dilutive effect of stock options outstanding              | 7                      |   | 6 |
| Diluted                                                   | 15,749                 |   | 15,782 |

| 3.   | Related Party Transactions |
|----------------|----------------------------|

----

Index

| 4.   | Commitments and Contingencies |
|----------------|-------------------------------|

----

Index

| 5.   | Inventories |
|----------------|-------------|

|                  |   | July 31, 2010 |    |   | January 30, 2010 |   |
|-----------------------|--------|---------------|---------|--------|------------------|--------|
| Inventories (at FIFO) |   | $             | 206,678 |   |             | $      | 204,834 |   |
| LIFO reserve          |   |          | (3,535  | )      |             |   | (3,324 | ) |
| Net inventories       |   | $             | 203,143 |   |             | $      | 201,510 |   |

| 6.   | Business Segments |
|----------------|-------------------|

----

Index

| Segment Information (in thousands)                                                                         |   | Thirteen Weeks Ended |    |   | Twenty-Six Weeks Ended |   |
|------------------------------------------------------------------------------------------------------------|--------|----------------------|---------|--------|------------------------|--------|
|                                                                                                       |   | July 31, 2010        |    |   | August 1, 2009         |   |   | July 31, 2010 |   |   | August 1, 2009 |   |
| Net Sales                                                                                                  |   |                 |    |   |                   |   |   |   |   |   |   |   |
|      Retail Trade                                                                 |   | $                    | 119,091 |   |                   | $      | 120,928 |   |   | $ | 235,176 |   |   | $ | 238,164 |   |
|      Electronic Commerce Trade                                                    |   |                 | 5,076   |   |                   |   | 5,348 |   |   |   | 10,717 |   |   |   | 10,866 |   |
|      Intersegment Sales Elimination                                               |   |                 | (4,119  | )      |                   |   | (3,833 | ) |   |   | (8,877 | ) |   |   | (8,418 | ) |
|           Net Sales                                      |   | $                    | 120,048 |   |                   | $      | 122,443 |   |   | $ | 237,016 |   |   | $ | 240,612 |   |
| Operating Income                                                                                           |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|      Retail Trade                                                                 |   | $                    | 3,511   |   |                   | $      | 2,612 |   |   | $ | 7,256 |   |   | $ | 6,177 |   |
|     Electronic Commerce Trade                                                          |   |                 | (67     | )      |                   |   | 176 |   |   |   | (182 | ) |   |   | 380 |   |
|     Intersegment Elimination of Certain       Costs |   |                 | (254    | )      |                   |   | (181 | ) |   |   | (528 | ) |   |   | (424 | ) |
|         Total Operating Income                                     |   | $                    | 3,190   |   |                   | $      | 2,607 |   |   | $ | 6,546 |   |   | $ | 6,133 |   |
|                                                                                                       |   |                 |    |   |                   |   |   |   |   | July 31, 2010 |   |   | January 30, 2010 |   |
| Assets                                                                                                     |   |                 |    |   |                   |   |   |   |   |   |   |   |   |   |   |   |
|      Retail Trade                                                                 |   |                 |    |   |                   |   |   |   |   | $ | 277,441 |   |   | $ | 271,701 |   |
|      Electronic Commerce Trade                                                    |   |                 |    |   |                   |   |   |   |   |   | 2,012 |   |   |   | 1,797 |   |
|      Intersegment Asset Elimination                                               |   |                 |    |   |                   |   |   |   |   |   | -- |   |   |   | -- |   |
|           Total Assets                                   |   |                 |    |   |                   |   |   |   |   | $ | 279,453 |   |   | $ | 273,498 |   |

|                | Thirteen Weeks Ended |   | Twenty-Six Weeks Ended |
|---------------------|----------------------|--------|------------------------|
|                | July 31, 2010        |   | August 1, 2009         |   | July 31, 2010 |   | August 1, 2009 |
| Books and Magazines | 80.4%                |   | 82.5%                  |   | 80.3% |   | 82.2% |
| General Merchandise | 8.9%                 |   | 7.5%                   |   | 8.8% |   | 7.6% |
| Café           | 4.0%                 |   | 4.0%                   |   | 4.2% |   | 4.2% |
| Other               | 6.7%                 |   | 6.0%                   |   | 6.7% |   | 6.0% |
| Total               | 100%                 |   | 100%                   |   | 100% |   | 100% |

| 7.   | Recent Accounting Pronouncements |
|----------------|----------------------------------|

----

Index

| 8.   | Discontinued Operations |
|----------------|-------------------------|

| 9.   | Debt and Lines of Credit |
|----------------|--------------------------|

----

Index

| 10.   | Income Taxes |
|-----------------|--------------|

| 11.   | Fair Value Measurements |
|-----------------|-------------------------|

----

Index

| 12.   | Revenue Recognition |
|-----------------|---------------------|

| 13.   | Equity Method Investment |
|-----------------|--------------------------|

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

----

Index

|                                           | Thirteen Weeks Ended |   | Twenty-Six Weeks Ended |
|------------------------------------------------|----------------------|--------|------------------------|
|                                           | July 31, 2010        |   | August 1, 2009         |   | July 31, 2010 |   | August 1, 2009 |
| Net sales                                      | 100.0%               |   | 100.0%                 |   | 100.0% |   | 100.0% |
| Gross profit                                   | 30.4%                |   | 29.5%                  |   | 30.2% |   | 29.7% |
| Operating, selling and administrative expenses | 24.6%                |   | 24.4%                  |   | 24.4% |   | 24.1% |
| Depreciation and amortization                  | 3.1%                 |   | 2.9%                   |   | 3.1% |   | 3.0% |
| Operating income                               | 2.7%                 |   | 2.1%                   |   | 2.8% |   | 2.5% |
| Interest expense, net                          | 0.1%                 |   | 0.1%                   |   | 0.1% |   | 0.1% |
| Income before income taxes                     | 2.5%                 |   | 2.0%                   |   | 2.6% |   | 2.4% |
| Income tax provision                           | 0.9%                 |   | 0.8%                   |   | 1.0% |   | 0.9% |
| Net income                                     | 1.6%                 |   | 1.2%                   |   | 1.6% |   | 1.5% |

| Segment Information (dollars in thousands) |   |                 |    |   |
|--------------------------------------------|--------|----------------------|---------|--------|
|                                       |   |                 |    |   |   |   |
| Net Sales                                  |   | Thirteen Weeks Ended |    |   | Twenty-Six Weeks Ended |   |
|                                       |   | July 31,2010         |    |   | August 1, 2009 |   |   | $ Change |   |   | % Change |   |   | July 31,2010 |   |   | August 1, 2009 |   |   | $ Change |   |   | % Change |   |
| Retail Trade                               |   | $                    | 119,091 |   |   | $ | 120,928 |   |   | $ | (1,837 | ) |   |   | (1.5 | %) |   | $ | 235,176 |   |   | $ | 238,164 |   |   | $ | (2,988 | ) |   |   | (1.3 | %) |
| Electronic Commerce Trade                  |   |                 | 5,076   |   |   |   | 5,348 |   |   |   | (272 | ) |   |   | (5.1 | %) |   |   | 10,717 |   |   |   | 10,866 |   |   |   | (149 | ) |   |   | (1.4 | %) |
| Intersegment Sales Elimination             |   |                 | (4,119  | )      |   |   | (3,833 | ) |   |   | (286 | ) |   |   | (7.5 | %) |   |   | (8,877 | ) |   |   | (8,418 | ) |   |   | (459 | ) |   |   | (5.5 | %) |
| Net Sales                                  |   | $                    | 120,048 |   |   | $ | 122,443 |   |   | $ | (2,395 | ) |   |   | (2.0 | %) |   | $ | 237,016 |   |   | $ | 240,612 |   |   | $ | (3,596 | ) |   |   | (1.5 | %) |

----

Index

----

Index

| Segment Information (dollars in thousands)                 |   |                 |   |   |                   |   |   |     |   |   |     |   |   |
|------------------------------------------------------------|--------|----------------------|--------|--------|------------------------|--------|--------|----------|--------|--------|----------|--------|--------|
|                                                       |   |                 |   |   |                   |   |   |     |   |   |     |   |   |   |   |
| Operating Income (Loss)                                    |   | Thirteen Weeks Ended |   |   | Twenty-Six Weeks Ended |   |
|                                                       |   | July 31,2010         |   |   | August 1, 2009         |   |   | $ Change |   |   | % Change |   |   | July 31,2010 |   |   | August 1, 2009 |   |   | $ Change |   |   | % Change |   |
| Retail Trade                                               |   | $                    | 3,511  |   |                   | $      | 2,612  |     |   | $      | 899      |   |   |   | 34.4 | % |   | $ | 7,256 |   |   | $ | 6,177 |   |   | $ | 1,079 |   |   |   | 17.5 | % |
| Electronic Commerce Trade                                  |   |                 | (67    | )      |                   |   | 176    |     |   |   | (243     | )      |   |   | (138.1 | %) |   |   | (182 | ) |   |   | 380 |   |   |   | (562 | ) |   |   | (147.9 | %) |
| Intersegment Elimination   of Certain Costs |   |                 | (254   | )      |                   |   | (181   | )        |   |   | (73      | )      |   |   | 40.3 | % |   |   | (528 | ) |   |   | (424 | ) |   |   | (104 | ) |   |   | 24.5 | % |
| Total Operating Income                                     |   | $                    | 3,190  |   |                   | $      | 2,607  |     |   | $      | 583      |   |   |   | 22.4 | % |   | $ | 6,546 |   |   | $ | 6,133 |   |   | $ | 413 |   |   |   | 6.7 | % |

----

Index

|                     |   | Payments Due Under Contractual Obligations(2) |    |
|--------------------------|--------|-----------------------------------------------|---------|
| (in thousands)           |   | Total                                         |    |   | FY 2011 |   |   | FY 2012 |   |   | FY 2013 |   |   | FY 2014 |   |   | FY 2015 |   |   | Thereafter |   |
| Short-term borrowings(1) |   | $                                             | 7,800   |   |   | $ | 7,800 |   |   | $ | -- |   |   | $ | -- |   |   | $ | -- |   |   | $ | -- |   |   | $ | -- |   |
| Industrial revenue bond  |   |                                          | 6,360   |   |   |   | -- |   |   |   | 6,360 |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |
| Subtotal of debt         |   |                                          | 14,160  |   |   |   | 7,800 |   |   |   | 6,360 |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |
| Interest                 |   |                                          | 84      |   |   |   | 42 |   |   |   | 42 |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |   |   | -- |   |
| Operating leases         |   |                                          | 150,469 |   |   |   | 17,470 |   |   |   | 29,787 |   |   |   | 24,267 |   |   |   | 20,668 |   |   |   | 17,994 |   |   |   | 40,283 |   |
| Total of obligations     |   | $                                             | 164,713 |   |   | $ | 25,312 |   |   | $ | 36,189 |   |   | $ | 24,267 |   |   | $ | 20,668 |   |   | $ | 17,994 |   |   | $ | 40,283 |   |

| (1) | Short-term borrowings represent borrowings under the $100.0 million facility that the Company anticipates repaying within the next 12 months. |
|-----|-----------------------------------------------------------------------------------------------------------------------------------------------|

| (2) | This table excludes any amounts related to the payment of the $2.0 million of income tax uncertainties, as the Company cannot make a reasonably reliable estimate of the periods of cash settlements with the respective taxing authorities. |
|-----|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

| ·   | Cash used for inventories in the twenty-six week period ended July 31, 2010 was $1.6 million, and cash used for inventories in the twenty-six week period ended August 1, 2009 was $0.4 million.  The change versus the prior year was due to an increase in the number of stores and the addition of new product assortments. |
|--------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cash provided by trade and related party accounts payables in the twenty-six week period ended July 31, 2010 was $4.7 million and cash provided by trade accounts and related party accounts payable in the twenty-six week period ended August 1, 2009 was $2.5 million. The change from the prior year was due to the timing of payments associated with our increased inventory levels. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·   | Cash used for accrued expenses and accrued income taxes was $7.2 million and $0.3 million in the twenty-six week periods ended July 31, 2010 and August 1, 2009, respectively. The change from last year results from the timing of payments, primarily associated with income taxes. |
|--------------------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·    | Depreciation and amortization expenses were essentially flat at $7.3 million and $7.2 million in the twenty-six week periods ended July 31, 2010 and August 1, 2009, respectively. |
|--------------------------|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

| ·    | Cash used for accounts and related party receivables was $0.9 million in the twenty-six week period ended July 31, 2010 and cash provided by accounts and related party receivables was $0.6 million at August 1, 2009.  The change from the prior year was due to a construction allowance receivable associated with a store relocation and amounts due for magazine commissions. |
|--------------------------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|

----

Index

Item 3.  Quantitative and Qualitative Disclosure About Market Risk

Item 4.  Controls and Procedures

Item 1.  Legal Proceedings

----

Index

Item 1A.  Risk Factors

Item 2.  Unregistered Sales of Equity Securities and Use of Proceeds

| Period                                  |   | Total Numberof SharesPurchased |    |   | Average PricePaid per Share |   |   | Total Number of Shares Purchased as Part of Publicly Announced Program |   |   | Approximate Dollar Value of Shares that May Yet Be Purchased Under the Program at End of Period |   |
|-----------------------------------------|--------|--------------------------------|---------|--------|-----------------------------|--------|--------|------------------------------------------------------------------------|--------|--------|-------------------------------------------------------------------------------------------------|--------|
|                                    |   |                           |    |   |                        |   |   |                                                                   |   |   |                                                                                            |   |
| May 2, 2010 throughMay 29, 2010         |   |                           | 31,000  |   |                        | $      | 7.00   |                                                                   |   |   | 31,000                                                                                          |   |   | $ | 4,393,000 |   |
| May 30, 2010 throughJuly 3, 2010        |   |                           | 132,000 |   |                        | $      | 6.57   |                                                                   |   |   | 132,000                                                                                         |   |   | $ | 3,531,000 |   |
| July 4, 2010 through July 31, 2010 |   |                           | 12,000  |   |                        | $      | 5.80   |                                                                   |   |   | 12,000                                                                                          |   |   | $ | 3,462,000 |   |
| Total                                   |   |                           | 175,000 |   |                        | $      | 6.57   |                                                                   |   |   | 175,000                                                                                         |   |   | $ | 3,462,000 |   |
|                                    |   |                           |    |   |                        |   |   |                                                                   |   |   |                                                                                            |   |   |   |   |   |

Item 3.  Defaults Upon Senior Securities

Item 4.  Reserved

 5.  Other Information

----

Index

Item 6.  Exhibits

| Exhibit Number | Description                                                                                                                                                                                                          |
|----------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|
| 3.1            | Certificate of Incorporation of Books-A-Million, Inc. (incorporated herein by reference to Exhibit 3.1 to the Registrant’s Registration Statement on Form S-1 (Capital Registration No. 33-52256))        |
| 3.2            | Amended and Restated By-Laws of Books-A-Million, Inc. (incorporated herein by reference to Exhibit 3 (ii) to the Company's Form 8-K dated August 20, 2009)                                                      |
| 10.1           | Books-A-Million, Inc. 2005 Incentive Award Plan, as amended by the Third Amendment (incorporated by reference to Exhibit 10.1 to Form 8-K dated May 20, 2010)                                                   |
| 10.2           | Books-A-Million, Inc. 1999 Amended and Restated Employee Stock Purchase Plan, as amended by the Second Amendment (incorporated by reference to Exhibit 10.2 to Form 8-K dated May 20, 2010)                     |
| 31.1           | Certification of Clyde B. Anderson, Chairman, President and Chief Executive Officer of Books-A-Million, Inc., pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended             |
| 31.2           | Certification of Douglas G. Markham, Executive Vice President and Chief Administrative Officer of Books-A-Million, Inc., pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended  |
| 31.3           | Certification of Brian W. White, Chief Financial Officer of Books-A-Million, Inc., pursuant to Rule 13a-14(a) under the Securities Exchange Act of 1934, as amended                                        |
| 32.1           | Certification of Clyde B. Anderson, Chairman, President and Chief Executive Officer of Books-A-Million, Inc., pursuant to 18 U.S.C. Section 1350                                                           |
| 32.2           | Certification of Douglas G. Markham, Executive Vice President and Chief Administrative Officer of Books-A-Million, Inc., pursuant to 18 U.S.C. Section 1350                                                |
| 32.3           | Certification of Brian W. White, Chief Financial Officer of Books-A-Million, Inc., pursuant to 18 U.S.C. Section 1350                                                                                      |

----

Index

| Date: September 9, 2010 | by: /s/ Clyde B. Anderson                                                    |
|-------------------------|------------------------------------------------------------------------------|
|                    | Clyde B. Anderson                                                            |
|                    | Chairman, President and Chief ExecutiveOfficer (Principal Executive Officer) |

| Date: September 9, 2010 | by: /s/ Douglas G. Markham                               |
|-------------------------|----------------------------------------------------------|
|                    | Douglas G. Markham                                       |
|                    | Executive Vice President and ChiefAdministrative Officer |

| Date: September 9, 2010 | by: /s/ Brian W. White                                               |
|-------------------------|----------------------------------------------------------------------|
|                    | Brian W. White                                                       |
|                    | Chief Financial Officer (Principal Financial and Accounting Officer) |