8-K

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D. C. 20549

                                    FORM 8-K

                                 CURRENT REPORT

     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

         Date of Report (Date of earliest event reported): July 14, 2003


                            PALMETTO BANCSHARES, INC.
               (Exact name of registrant as specified in charter)


South Carolina                     0-26016                    74-2235055
- ---------------------------    -----------------          --------------------
State or other jurisdiction    Commission File              IRS Employer I.D.
of incorporation                    Number                       Number



301 Hillcrest Drive, Laurens, South Carolina                     29360
- --------------------------------------------                     -----
Address of principal executive offices                          Zip Code


                                 (864) 984-4551
                                 --------------
                          Registrant's telephone number








ITEM 9. REGULATION FD DISCLOSURE

The following is intended to be furnished  pursuant to Item 12,  "Disclosure  of
- --------------------------------------------------------------------------------
Results of Operations and Financial Condition."
- -----------------------------------------------

On July 14, 2003 Palmetto Bancshares,  Inc. announced the results for the second
quarter ended June 30, 2003.

For more  information  regarding  this matter,  see the press  release  attached
hereto as Exhibit 99.

ITEM 7.  FINANCIAL STATEMENTS AND EXHIBITS

(c) Exhibits

    99   Press release dated July 14, 2003



                                   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.



PALMETTO BANCSHARES, INC.


By:

/s/      L. Leon Patterson
- ---------------------------------------
 L. Leon Patterson
 Chairman and Chief Executive Officer


/s/      Paul W. Stringer
- ---------------------------------------
 Paul W. Stringer
 President and Chief Operating Officer
(Chief Accounting Officer)

Date:   July 16, 2003

EX-99

FOR IMMEDIATE RELEASE                       FOR MORE INFORMATION CONTACT:
JULY 14, 2003                               PENNY KREIN, 864/984-8395
                                            kreinp@palmettobank.com


                 PALMETTO BANCSHARES, INC. REPORTS 14% INCREASE
   FOR SIX MONTH PERIOD ENDED AND 9% INCREASE FOR QUARTER ENDED JUNE 30, 2003

UPSTATE,  SC - Leon Patterson,  chairman and chief executive officer of Palmetto
Bancshares,  Inc., parent company for The Palmetto Bank, reported net income for
the quarter ending June 30, 2003 of $2.7 million,  a 9% increase from net income
for the same quarter of 2002.  Net income for the six months ended June 30, 2003
was $5.6 million,  a 14% increase over $4.9 million reported for the same period
in 2002.

Net income per diluted  share for the second  quarter was $.42,  an 11% increase
over the $.38 per share  reported for the second quarter of 2002. Net income per
diluted  share for the six months  ended June 30, 2003 was $.87,  a 14% increase
over $.76 per diluted share reported for the same period of 2002.

Increased  net income for the six month period ended June 30, 2003 resulted from
a continued growth of earning assets,  an 7% improvement in net interest income,
and a 5% decline in the  provision  for loan  losses,  compared  to the same six
months ended June 30, 2002.

The company reported return on shareholders'  equity of 16.09% at June 30, 2003,
as compared with 16.12% reported at June 30, 2002.  Return on assets at June 30,
2003 was 1.35%, up from 1.32% at June 30, 2002.

Total assets at quarter end were $860 million,  an increase of 13% compared with
June 30, 2002.  Total loans increased 18% to $680 million,  while total deposits
rose to $777 million,  a 12% increase  compared with June 30, 2002.  The company
reported total assets under  management,  including  mortgage loans serviced for
others and trust and investment  assets, of $1.5 billion at June 30, 2003, a 14%
increase from the total reported at June 30, 2002.

"In spite of the challenging  economic times we continue to face, we are pleased
with the company's  consistently  strong  performance  over the last quarter and
particularly over the past six months," said Leon Patterson,  chairman and chief
executive officer.

Founded in 1906,  The Palmetto Bank is an  independent  Upstate based  financial
institution,  with 30 locations  in twenty  communities  throughout  the Upstate
counties of  Abbeville,  Anderson,  Cherokee,  Greenville,  Greenwood,  Laurens,
Oconee, and Spartanburg.

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(Date Reported: July 14, 2003)