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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 QhjqnpahyAeefKwI623JsAFsy8k2b33Hd3wuHOA70/BahNUOZn+Cu4anGD3Aw6g7
 x4OFmyG79D9Qhg2BDN4dBg==

<SEC-DOCUMENT>0000892251-06-000450.txt : 20060627
<SEC-HEADER>0000892251-06-000450.hdr.sgml : 20060627
<ACCEPTANCE-DATETIME>20060627161714
ACCESSION NUMBER:		0000892251-06-000450
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20060626
FILED AS OF DATE:		20060627
DATE AS OF CHANGE:		20060627

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			Jalbout Fred
		CENTRAL INDEX KEY:			0001364710

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-13375
		FILM NUMBER:		06927256

	BUSINESS ADDRESS:	
		BUSINESS PHONE:		514-745-0310

	MAIL ADDRESS:	
		STREET 1:		7809 TRANS CANADA
		CITY:			MONTREAL
		STATE:			A8
		ZIP:			H4S 1L3

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			LSI INDUSTRIES INC
		CENTRAL INDEX KEY:			0000763532
		STANDARD INDUSTRIAL CLASSIFICATION:	ELECTRIC LIGHTING & WIRING EQUIPMENT [3640]
		IRS NUMBER:				310888951
		STATE OF INCORPORATION:			OH
		FISCAL YEAR END:			0630

	BUSINESS ADDRESS:	
		STREET 1:		10000 ALLIANCE RD
		STREET 2:		P O BOX 42728
		CITY:			CINCINNATI
		STATE:			OH
		ZIP:			45242
		BUSINESS PHONE:		5135796411

	MAIL ADDRESS:	
		STREET 1:		10000 ALLIANCE RD
		STREET 2:		P O BOX 42728
		CITY:			CINCINNATI
		STATE:			OH
		ZIP:			45242

	FORMER COMPANY:	
		FORMER CONFORMED NAME:	LSI LIGHTING SYSTEMS INC
		DATE OF NAME CHANGE:	19891121
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>jalbout4062606_ex.xml
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2006-06-26</periodOfReport>

    <notSubjectToSection16>0</notSubjectToSection16>

    <issuer>
        <issuerCik>0000763532</issuerCik>
        <issuerName>LSI INDUSTRIES INC</issuerName>
        <issuerTradingSymbol>LYTS</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001364710</rptOwnerCik>
            <rptOwnerName>Jalbout Fred</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>7809 TRANS CANADA</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>MONTREAL</rptOwnerCity>
            <rptOwnerState>A8</rptOwnerState>
            <rptOwnerZipCode>H4S 1L3</rptOwnerZipCode>
            <rptOwnerStateDescription>QUEBEC, CANADA</rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>1</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle>President, LSI Tech Solu Plus</officerTitle>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeTransaction>
            <securityTitle>
                <value>Common Stock</value>
            </securityTitle>
            <transactionDate>
                <value>2006-06-26</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>1419355</value>
                    <footnoteId id="F2"/>
                </transactionShares>
                <transactionPricePerShare>
                    <footnoteId id="F1"/>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>1419355</value>
                    <footnoteId id="F2"/>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>I</value>
                </directOrIndirectOwnership>
                <natureOfOwnership>
                    <value>By corporation</value>
                    <footnoteId id="F3"/>
                </natureOfOwnership>
            </ownershipNature>
        </nonDerivativeTransaction>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeTransaction>
            <securityTitle>
                <value>Option to Buy</value>
                <footnoteId id="F4"/>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>14.36</value>
            </conversionOrExercisePrice>
            <transactionDate>
                <value>2006-06-26</value>
            </transactionDate>
            <transactionCoding>
                <transactionFormType>4</transactionFormType>
                <transactionCode>A</transactionCode>
                <equitySwapInvolved>0</equitySwapInvolved>
            </transactionCoding>
            <transactionAmounts>
                <transactionShares>
                    <value>20000</value>
                </transactionShares>
                <transactionPricePerShare>
                    <value>0</value>
                </transactionPricePerShare>
                <transactionAcquiredDisposedCode>
                    <value>A</value>
                </transactionAcquiredDisposedCode>
            </transactionAmounts>
            <exerciseDate>
                <value>2007-06-02</value>
            </exerciseDate>
            <expirationDate>
                <value>2016-06-02</value>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>20000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>20000</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeTransaction>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Received as partial consideration for all of the issued and outstanding capital stock of 4349466 Canada Inc. (&quot;Canada&quot;)
 pursuant to a Stock Purchase Agreement dated as of June 26, 2006 (&quot;SPA&quot;) by and among the Issuer, Jalbout Holdings, Inc.
 (&quot;Holdings&quot;), Saco Technologies Inc. (&quot;Saco&quot;), 3970957 Canada, Inc. (&quot;Canco&quot;), Canada, the reporting person and Bassam
 Jalbout.  The closing price of the Issuer's common stock on the closing date of the transaction contemplated by the SPA was
 $14.36 per share.</footnote>
        <footnote id="F2">All of the shares will be held in escrow pursuant to the terms of an Escrow Agreement dated as of June 26, 2006 by and among
 the Issuer, Saco and The Bank of New York Trust Company, N.A. (the &quot;Escrow Agreement&quot;), under which Saco, of which the
 reporting person beneficially owns 50%, will have the authority to direct the escrow agent thereunder to sell all or a
 portion of the escrowed shares.  The shares held in escrow pursuant to the Escrow Agreement are subject to forfeiture under
 the terms of the Escrow Agreement for a period following the closing date in order to satisfy claims arising as a result of
 breaches of representations and warranties or covenants under the SPA by Saco, Canco, Holdings, Bassam Jalbout or the
 reporting person.  Following the termination of the escrow period under the Escrow Agreement, any remaining shares and any
 proceeds from sales thereof will be distributed to Saco.</footnote>
        <footnote id="F3">The corporation, Saco, of which the reporting person beneficially owns 50%, acquired these shares pursuant to the SPA, which
 shares shall be held in escrow, as provided in footnote 2 above.  The reporting person disclaims beneficial ownership of
 these shares except to the extent of his pecuniary interest therein, and the inclusion of these shares in this report shall
 not be deemed an admission of beneficial ownership of all of the reported shares for purposes of Section 16 or any other
 purpose.</footnote>
        <footnote id="F4">Non-qualified stock options granted pursuant to the Company's 2003 Equity Compensation Plan.  The options are exercisable at
 a rate of 25% per year of the aggregate grant, beginning on the 1st anniversary of the grant date.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Michael J. Moeddel, Attorney-in-Fact for Fred Jalbout</signatureName>
        <signatureDate>2006-06-27</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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