SCHEDULE 14A INFORMATION

Proxy Statement Pursuant to Section 14(a) of
the Securities Exchange Act of 1934 (Amendment No. )

Filed by the Registrant /X/
Filed by a Party other than the Registrant / /

Check the appropriate box:
/ / Preliminary Proxy Statement
/ / Confidential, for Use of the Commission Only (as permitted by Rule
14a-6(e)(2))
/X/ Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section
240.14a-12

SHELBY WILLIAMS INDUSTRIES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

N/A
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

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Notes:

SHELBY WILLIAMS INDUSTRIES, INC.
[LOGO] 11-111 MERCHANDISE MART
CHICAGO, ILLINOIS 60654

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NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
TO BE HELD MAY 6, 1997

To the Stockholders of
SHELBY WILLIAMS INDUSTRIES, INC.

You are hereby notified that the Annual Meeting of Stockholders of SHELBY
WILLIAMS INDUSTRIES, INC. will be held at the offices of said Company, 11-111
Merchandise Mart, Chicago, Illinois, on Tuesday, May 6, 1997 at 9:30 A.M. for
the following purposes:

1. Electing a Board of Directors to serve until the next annual meeting
of stockholders or until their respective successors shall have been elected
and qualified;

2. Considering and acting upon a proposal to ratify the selection of
Ernst & Young LLP as independent auditors for the fiscal year ending
December 31, 1997; and

3. Transacting such other business as may properly come before the
meeting or any adjournment thereof.

The close of business on March 12, 1997 has been fixed as the record date for
determination of the stockholders entitled to notice of and to vote at said
meeting. A list of stockholders will be open for examination during ordinary
business hours by any stockholder, for any purpose germane to such meeting,
during the ten days prior to the meeting date at the Company's address set forth
above.

IF YOU DO NOT EXPECT TO BE PRESENT PERSONALLY AT THE MEETING, PLEASE DATE,
SIGN AND RETURN THE ENCLOSED PROXY IN THE ENVELOPE PROVIDED.

By Order of the Board of Directors

Walter Roth, Secretary

March 24, 1997

PROXY STATEMENT
-------------

SHELBY WILLIAMS INDUSTRIES, INC.
11-111 MERCHANDISE MART
CHICAGO, ILLINOIS 60654

--------------

The enclosed proxy is solicited by the Board of Directors of Shelby Williams
Industries, Inc. (the "Company") for the Company's annual meeting of
stockholders to be held May 6, 1997. Each proxy received will be voted as
directed. If no direction is indicated, the proxy will be voted FOR the election
of the nominees named below as directors, and FOR the proposal to ratify the
selection of independent auditors, in each case as described below. Any proxy
may be revoked at any time prior to the voting thereof by notifying the
Secretary of the Company, either prior to the meeting (at the above address) or
at the meeting if you attend personally. A later dated proxy will revoke a prior
dated proxy.
Only holders of the Company's 8,743,863 outstanding shares of Common Stock of
record at the close of business on March 12, 1997 will be entitled to vote at
the meeting. Each share is entitled to one vote on each matter to be voted upon.
Abstentions will be treated as shares present and entitled to vote but as not
voted for purposes of determining the approval of any matters submitted to the
stockholders for a vote. Abstentions will have the same effect as negative
votes. If a broker indicates on the proxy that it does not have discretionary
authority as to certain shares to vote on a particular matter, those shares will
not be considered as present and entitled to vote with respect to that matter.
The approximate date on which this Proxy Statement and the form of proxy
enclosed herewith are first to be sent or given to the Company's stockholders is
intended to be March 24, 1997.

ELECTION OF DIRECTORS

At the meeting, a Board of eight directors is to be elected by plurality vote.
All of the nominees named below are presently directors of the Company. If any
vacancy in the list of nominees should occur for any reason (no reason being
presently known), discretionary authority is solicited to vote for the election
of other persons. The term of office of the directors to be elected will be
until the next annual meeting of stockholders (presently expected to be held May
5, 1998) and until their respective successors are elected and qualified, and
the Company has no reason to believe that the nominees named will not be
available for election as directors for their prescribed terms.
The following table sets forth information with respect to each nominee for
director according to information furnished the Company by such nominee.

NAME, AGE AND DIRECTOR OF
POSITIONS PRESENTLY PRINCIPAL OCCUPATIONS COMPANY
HELD WITH COMPANY DURING PAST FIVE YEARS SINCE
- --------------------------------- ----------------------------------------------------------------- -----------

Robert P. Coulter, 54 ........... President and Chief Operating Officer of the Company since May,
President; Chief Operating 1990; prior thereto President and Treasurer
Officer; member of executive
committee 1978
Robert L. Haag, 70 .............. Private Investor
Member of executive
compensation and stock option
committees 1976

William B. Kaplan, 56 ........... Chairman and CEO of Senior Lifestyle Corporation (development and
Member of audit committee management of housing for the elderly) 1992
Douglas A. Parker, 39 ........... President of Hospitality Worldwide Services, Inc. (serves the
interior requirements for the hospitality industry) since
January, 1997, and President and CEO during the past five years
of Leonard Parker Company, Inc. (contract purchasing agents for
the hospitality industry), which became a subsidiary of
Hospitality Worldwide Services, Inc. in January, 1997 1996
Herbert L Roth, 73 .............. Self-employed as a financial consultant and general manager of
Chairman of audit committee and several real estate partnerships
member of stock option
committee 1976
Manfred Steinfeld, 72 ........... Chairman of Executive Committee since January, 1996; Chiarman of
Chairman of the Executive the Board prior to January, 1996; Chief Executive Officer of
Committee; chairman of the Company prior to May, 1991
executive committee and
executive compensation
committee 1976
Paul N Steinfeld, 42 ............ Chief Executive Officer of the Company since May, 1991; Chairman
Chairman of the Board; Chief of the Board since January, 1996; prior thereto Vice Chairman
Executive Officer of the Board; Chief Administrative Officer of the Company prior
to May, 1991 1980
Trisha Wilson, 49 ............... President of Wilson & Associates, Inc. (interior architectural
Member of executive hospitality design)
compensation committee 1993

Manfred Steinfeld is also a director of Amalgamated Trust & Savings Bank.
Douglas A. Parker is also a director of Hospitality Worldwide Services, Inc.
Herbert L. Roth is also a director of Corcom, Inc. Manfred Steinfeld is the
father of Paul N. Steinfeld; there is no other family relationship between any
director or executive officer of the Company. Herbert L. Roth is the brother of
Walter Roth, who is Secretary of the Company and a partner of the law firm of
D'Ancona & Pflaum. The Company retained said firm as legal counsel during the
last fiscal year and such retainer is continuing during the current fiscal year.
In 1996, non-employee directors were paid an annual retainer at the rate of
$16,000, together with a fee of $500 for each committee meeting attended.
The Company has in effect a 1995 Directors' Stock Option Plan (the "1995
Directors' Plan") which provides that on January 18 of each of the

years 1995,1996 and 1997, each director of the Company who is not a full-time
employee of the Company receives an option for 4,000 shares of the Company's
Common Stock with an exercise price of 100% of fair market value on the
applicable date of grant. Options become fully exercisable six months after date
of grant and expire five years from date of grant subject to earlier termination
in certain circumstances in the event of termination as a director. There have
been no option exercises. Option grants of 4,000 shares each under the 1995
Directors' Plan were made to each of Robert L. Haag, William B. Kaplan, Herbert
L. Roth and Trisha Wilson on January 18, 1996 at an option exercise price of
$12.25 per share. On January 18, 1997, option grants of 4,000 shares each under
said Plan were made to each of Mr. Haag, Mr. Kaplan, Herbert L. Roth, Ms. Wilson
and Douglas A. Parker at an option exercise price of $14.00 per share.

BENEFICIAL OWNERSHIP OF SHARES

The following information is furnished as of March 1, 1997 (unless otherwise
indicated) to indicate beneficial ownership of the Company's Common Stock by
each director and nominee, by certain executive officers of the Company, and by
all directors and executive officers as a group. Such information has been
furnished to the Company by the indicated owners. Unless otherwise indicated,
beneficial ownership is direct.

AMOUNT
BENEFICIALLY
NAME OF BENEFICIAL OWNER OWNED PERCENT
- ---------------------------------------------------------------------- ------------ -------

Directors and Nominees:
Robert P. Coulter................................................... 83,420(B) 1.0%
Robert L. Haag...................................................... 148,688(C) 1.7%
William B. Kaplan................................................... 10,000(C) (A)
Douglas A. Parker................................................... 1,000 (A)
Herbert L. Roth..................................................... 19,999(C) (A)
Manfred Steinfeld................................................... 2,547,246(D) 29.1%
Paul N. Steinfeld................................................... 627,666(E) 7.2%
Trisha Wilson....................................................... 9,500(C) (A)
Certain executive officers:
Peter W. Barile..................................................... 72,341(F) (A)
Sam Ferrell......................................................... 19,052(G) (A)
All directors and executive officers as a group....................... 3,538,912(H) 40.3%

- ---------
(A) Less than 1%.

(B) Includes 45,503 shares owned by Mr. Coulter's wife, as to which he disclaims
beneficial ownership. Also includes 2,666 stock options deemed exercised
solely for the purpose of showing total shares owned by Mr. Coulter.

(D) Includes 25,054 shares owned by Mr. Steinfeld's wife and 488 shares owned by
The Steinfeld Foundation, an Illinois not-for-profit corporation of which
Mr. Steinfeld is an officer and Mr. Steinfeld and his wife are two of three
directors; Mr. Steinfeld disclaims beneficial ownership of such shares. Also
includes 40,058 shares held by Manfred Steinfeld, Paul N. Steinfeld, Robert
P. Coulter and Sam Ferrell as trustees of the Company's Employee Stock
Ownership Plan; Mr. Steinfeld disclaims beneficial ownership of such shares.
(The shares held by the trustees of said plan are not included in share
figures for Paul N. Steinfeld, Robert P. Coulter or Sam Ferrell in order to
avoid duplication.) Also includes 331,000 shares owned by The Fern and
Manfred Steinfeld Charitable Remainder Trust UTA 10/17/95 (the "CRT"), of
which Mr. Steinfeld is settlor and a trustee with sole power as trustee to
vote and dispose of said shares; Mr. Steinfeld's wife is the other trustee
of the CRT.

(E) Includes 2,666 stock options deemed exercised solely for the purpose of
showing total shares owned by Paul N. Steinfeld. Excludes shares held by The
Steinfeld Foundation, of which Paul N. Steinfeld is one of three directors
and disclaims beneficial ownership. See Note (D).

(F) Includes 3,856 shares held by Mr. Barile as custodian for his child, as to
which he disclaims beneficial ownership. Also includes 2,000 stock options
deemed exercised solely for the purpose of showing total shares owned by Mr.
Barile.

(G) Includes 2,000 stock options deemed exercised solely for the purpose of
showing total shares owned by Mr. Ferrell.

(H) See matters covered by the foregoing notes.

The following information is furnished as of March 1, 1997 (unless otherwise
indicated) with respect to the only persons known to the Company to be the
beneficial owners of more than 5% of the Company's outstanding Common Stock.
Such information has been furnished to the Company by the indicated owners.
Unless otherwise indicated, beneficial ownership is direct.

AMOUNT BENE-
FICIALLY
NAME AND ADDRESS OF BENEFICIAL OWNER OWNED PERCENT
- ---------------------------------------------------------------------- ------------ -------

Manfred Steinfeld .................................................... 2,547,246(1) 29.1%
11-111 Merchandise Mart
Chicago, IL 60654
Paul N. Steinfeld .................................................... 627,666(1) 7.2%
150 Shelby Williams Drive
Morristown, TN 37813
David L. Babson & Co., Inc. .......................................... 797,100(2) 9.1%
One Memorial Drive
Cambridge, MA 02142
Brinson Partners, Inc. ............................................... 531,900(3) 6.1%
209 South LaSalle Street
Chicago, IL 60604

- ------------------------
(1) See notes to preceding table.

(2) Schedule 13G dated February 7, 1997, states that Babson in its capacity as
investment adviser has sole voting power as to 527,600 shares, shared voting
power as to 269,500 shares, and sole dispositive power as to 797,100 shares.

(3) Schedule 13G dated February 12, 1997 states that Brinson Partners, Inc.
("BPI") is a wholly-owned subsidiary of Brinson Holdings, Inc. ("BHI"); that
Brinson Trust Company ("BTC") is a wholly-owned subsidiary of BPI; that BHI
is a wholly-owned subsidiary of SBC Holding (USA), Inc. ("SBCUSA"); and that
SBUSA is a wholly-owned subsidiary of Swiss Bank Corporation ("SBC"). BPI
has shared voting and shared dispositive power as to 531,900 shares; and BTC
has shared voting and shared dispositive power as to 203,315 shares. The
address of SBCUSA is 222 Broadway, New York, NY; and the address of SBC is
Aeschenplatz 6 CH-4002, Basel, Switzerland.

On March 4, 1997, the Company filed a registration statement with the
Securities and Exchange Commission relating to a proposed underwritten offering
of 2,000,000 shares of the Company's Common Stock, of which 569,000 shares are
intended to be sold by the Company, 1,100,000 shares by Manfred Steinfeld, and
331,000 shares by the CRT. The Company and Manfred Steinfeld intend to grant to
the underwriters an option to purchase up to 150,000 additional shares of Common
Stock from each, for an aggregate of 300,000 shares of Common Stock, to cover
over-allotments, which option may be exercised only pro rata among the Company
and Mr. Steinfeld. The registration statement relating to these securities has
not yet become effective, and these securities may not be sold nor may offers to
buy be accepted prior to the time the registration statement becomes effective.
If the proposed offering of shares described in this paragraph is consummated,
Manfred Steinfeld's beneficial ownership of shares of Common Stock of the
Company, as described in the tables above, will be reduced accordingly.

EXECUTIVE COMPENSATION

There is shown below certain information concerning the compensation of those
persons who at December 31, 1996 were the Chief Executive Officer of the Company
and the other four most highly compensated executive officers of the Company:

SUMMARY COMPENSATION TABLE

LONG TERM
COMPENSATION
-------------
AWARDS
-------------
ANNUAL COMPENSATION(1) SECURITIES
---------------------- UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($)(2) OPTIONS(#) COMPENSATION($)(3)
- -------------------------------------------- --------- --------- ----------- ------------- -------------------

Paul N. Steinfeld........................... 1996 250,000 71,250 4,000 820
Chairman of the Board; 1995 225,000 33,750 4,000 740
Chief Executive Officer 1994 210,000 -0- -0- 910

Robert P. Coulter........................... 1996 250,000 71,250 4,000 820
President; Chief Operating Officer 1995 225,000 33,750 4,000 740
1994 210,000 -0- -0- 920

Manfred Steinfeld........................... 1996 250,000 85,500 -0- -0-
Chairman of the Executive Committee 1995 320,000 48,000 -0- -0-
1994 300,000 -0- -0- 420

Peter W. Barile............................. 1996 125,000 37,200 3,000 780
Executive Vice President 1995 123,000 18,450 3,000 620
1994 118,000 -0- -0- 730

Sam Ferrell................................. 1996 125,000 36,750 3,000 780
Vice President of Finance; 1995 120,000 18,000 3,000 740
Chief Financial Officer 1994 115,000 -0- -0- 660

- ------------------------

(1) The aggregate amount of any perquisites or other personal benefits was less
than 10% of the total of annual salary and bonus and is not included in the
above table. The amount of pension payments to Manfred Steinfeld (see below)
is also not included in the above table.

(2) The above table includes one-half of the bonuses for 1996. The remaining
one-half will be paid in January, 1998, subject to forfeiture (and
reallocation to other participants) in the event of certain terminations of
employment. At December 31, 1996, an aggregate of $150,000 was accrued for
such payments to the persons in the above table.

(3) Dollar amounts shown are allocations under the Company's ESOP described
below. The ESOP purchases were allocated to Company stock as follows for the
years 1996, 1995 and 1994: Paul N. Steinfeld, 62 shares, 85 shares and 76
shares; Mr. Coulter, 65 shares, 85 shares and 76 shares; Manfred Steinfeld,
no shares, no shares and 35 shares; Mr. Barile, 62 shares, 70 shares and 61
shares; and Mr. Ferrell, 62 shares, 85 shares and 55 shares. Under mandatory
requirements based on age, Manfred Steinfeld's interest in the ESOP was
distributed to him in 1995.

All of the Company's executive officers are eligible to participate in a
Senior Management Incentive Plan. The plan each year is based on achieving
certain earnings per share objectives for the year, subject to adjustments for
certain factors. Certain percentage bonuses are paid depending on the extent to
which plan objectives are achieved. If such objectives are fully achieved for
1997, bonuses of 50% of base salary would be paid to participants, of which
one-half would be deferred for one year subject to forfeiture (and reallocation
to other participants) in the event of certain terminations of employment. No
bonuses were earned for 1994.
The Company maintains a pension plan covering all salaried and commissioned
employees of the Company and those subsidiaries expressly included under the
terms of the plan. The Company intends to accrue and fund amounts sufficient to
cover normal costs. Each employee who is at least age 21 becomes a participant
in the plan after completing 1,000 hours of service during a relevant 12 month
period. A participant's benefits are fully vested after five years of service.
Benefits are equal to the sum of (i) 2.0% for each pension service year prior to
January 1, 1996, times final average annual compensation; plus (ii) 1.5% for
each pension service year after December 31, 1995, times final average annual
compensation; plus (iii) 1.25% for each pension service year, times final excess
compensation (based on social security taxable wage base). Plan benefits are not
subject to off-set for social security or other non-plan benefits. No benefits
are payable until after five years of participation in the plan. At January 1,
1997 each of the persons named in the summary compensation table above except
Manfred Steinfeld, had been credited with ten and one-half years of pension
service. Under mandatory requirements based on age, Manfred Steinfeld began, in
1995, receiving his annual pension of $88,560.
The following table indicates examples of annual pension benefits to be paid
in an annuity of equal monthly installments upon normal retirement at age 65
(after five years of pension service). Actuarially equivalent benefits are paid
at early retirement after age 55.

YEARS OF PENSION SERVICE*
-----------------------------------------------------
RENUMERATION 5 10 15 20 25**
- ------------------------------------------------------- --------- --------- --------- --------- ---------

$100,000............................................... $ 9,925 $ 19,850 $ 29,775 $ 39,700 $ 49,625
110,000............................................... 11,300 22,600 33,900 45,200 56,500
120,000............................................... 12,675 25,350 38,025 50,700 63,375
130,000............................................... 14,050 28,100 42,150 56,200 70,250
140,000............................................... 15,425 30,850 46,275 61,700 77,125
150,000**............................................. 16,800 33,600 50,400 67,200 84,000

- ------------------------

* In 1995, the benefits based on final average compensation were changed from
2% to 1.5% for each pension service year on or after January 1, 1996. This
change cannot deprive a participant of benefits that were accrued prior to
1995; therefore, the prospective effect of the change will vary from
participant to participant. The preceding table sets out the constant values
that would be applicable to a participant who has always been subject to the
lower formula. As of December 31, 1996, the annual accrued benefit under the
plan for each of the executive officers named in the summary compensation
table was as follows: Paul N. Steinfeld, $42,660; Robert P. Coulter,
$47,620; Manfred Steinfeld, $88,560; Peter W. Barile, $27,210; and Sam
Ferrell, $25,390.

** Maximum under the plan.

The Company maintains an Employee Stock Ownership Plan ("ESOP"). Salaried and
commissioned employees who are at least 21 years old and who completed at least
1,000 hours of service during a relevant 12 month period are eligible to
participate in the ESOP. The Company is entitled to make contributions to the
ESOP either in Company stock or in cash, for the purpose of purchasing Company
stock. The amount of the Company's annual contribution is discretionary. For
calendar year 1996, the Company contributed $63,000 to the ESOP.

The amount that the Company contributes to the ESOP is allocated among the
accounts of participants who are employed by the Company on the last day of the
year in proportion to their relative compensation. A separate account is
maintained on behalf of each participant to reflect the shares of Company stock
that have been allocated to him or her. Upon termination of employment,
participants are eligible to receive a distribution of the Company stock held in
their accounts, if termination of employment occurs after the particular
participant has been credited with five years of service or on account of death,
disability or attainment of age 65.

STOCK OPTIONS

The Company has a stock option plan under which stock options are granted to
key employees. All options are incentive stock options and are granted at 100%
of the fair market value at the time of grant, except that options to Paul N.
Steinfeld are granted at 110% of the fair market value at the time of grant. A
person is not eligible to be granted an option at any time when he owns directly
(and not by attribution) stock possessing more than 10% of the total combined
voting power of the Common Stock of the Company. Thus Manfred Steinfeld is not
eligible to receive options under the stock option plan.
Shown below is information with respect to individual grants of stock options
made during the last completed fiscal year to each of the executive officers
named in the summary compensation table.

OPTION GRANTS IN LAST FISCAL YEAR

INDIVIDUAL GRANTS POTENTIAL REALIZABLE
---------------------------------------------------------- VALUE AT ASSUMED ANNUAL
NUMBER OF RATES OF STOCK PRICE
SECURITIES % OF TOTAL OPTIONS EXERCISE APPRECIATION FOR OPTION
UNDERLYING GRANTED TO PRICE PER TERM
OPTIONS EMPLOYEES IN FISCAL SHARE EXPIRATION ------------------------
NAME GRANTED(#) YEAR ($/SH.) DATE(1) 5%($) 10%($)
- ------------------------------------ ----------- ------------------- ----------- ----------- ----------- -----------

Paul N. Steinfeld................... 4,000 8.5 13.34 1/17/01 14,740 32,571
Robert P. Coulter................... 4,000 8.5 12.13 1/17/01 13,400 29,610
Manfred Steinfeld................... -0- N/A N/A N/A N/A N/A
Peter W. Barile..................... 3,000 6.4 12.13 1/17/01 10,050 22,207
Sam Ferrell......................... 3,000 6.4 12.13 1/17/01 10,050 22,207

- ------------------------

(1) All options become exercisable in one-third increments 15 months, 30 months
and 45 months after date of grant.

Shown below is information with respect to exercises of stock options during
the last completed fiscal year by each of the executive officers named in the
summary compensation table and the fiscal year-end value of unexercised options.

AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR-END OPTION
VALUES

NUMBER OF
SHARES VALUE OF
UNDERLYING UNEXERCISED
UNEXERCISED IN-THE-MONEY
OPTIONS AT OPTIONS AT
SHARES FY-END(#) FY-END($)
ACQUIRED ON VALUE EXERCISABLE/ EXERCISABLE/
NAME EXERCISE(#) REALIZED($) UNEXERCISABLE UNEXERCISABLE
- ----------------------------------- ------------- ------------- -------------- --------------

Paul N. Steinfeld.................. -0- -0- 11,333/6,667 35,066/9,385
Robert P. Coulter.................. 3,334 16,253 1,333/6,667 5,748/12,000
Manfred Steinfeld.................. -0- -0- -0- -0-
Peter W. Barile.................... 1,334 7,504 1,000/5,000 4,312/9,000
Sam Ferrell........................ 1,667 8,127 1,000/5,000 4,312/9,000

COMPENSATION COMMITTEE INTERLOCKS
AND INSIDER PARTICIPATION

Manfred Steinfeld, who served as chairman of the executive compensation
committee during the last

completed fiscal year, was, during the fiscal year, an executive officer of the
Company.

REPORT OF THE EXECUTIVE COMPENSATION
AND STOCK OPTION COMMITTEES

This report of the Executive Compensation and Stock Option Committees shall
not be deemed incorporated by reference by any general statement incorporating
this Proxy Statement by reference into any filing under the Securities Act of
1933 or the Securities Exchange Act of 1934 (the "Acts"), except to the extent
that the Company specifically incorporates this information by reference, and
shall not otherwise be deemed filed under such Acts.
The Company applies a consistent philosophy to compensation for all employees,
including senior management. This philosophy incorporates the following themes:

1. Compensation should relate to the value created for stockholders.

2. Compensation programs should support the short and long-term strategic goals
and objectives of the Company.

3. Compensation programs should reflect and promote the Company's values, and
reward individuals for outstanding contributions to the Company's success.

4. Short and long-term compensation is critical in attracting and retaining
well qualified executives and other employees.

5. Compensation should be based on individual contribution; however, amounts
earned by executives in variable compensation programs should be dictated by
how the Company performs.

6. Compensation should be competitive without being at either the low or high
ends of the ranges enumerated for similar positions elsewhere.
The Company has a simple compensation program that consists of cash and equity
based compensation. This program allows the Company to successfully attract and
retain key employees, permits it to provide useful products and services to
customers, enhance stockholder value, motivate innovation, foster teamwork, and
adequately reward employees.

CASH-BASED COMPENSATION

SALARY

The Company sets base salary for employees based upon the philosophy
indicated above. Using these elements, the Executive Compensation Committee
compares corresponding amounts paid by other companies selected because of the
similarity of their businesses to that of the Company and/or to

provide local market comparisons. These companies are not necessarily within the
S&P Lodging-Hotels Index which has been used for purposes of comparison in the
"Performance Graph." However, the committee believes these companies more
accurately reflect the market in which the Company competes for executive
talent.

SENIOR MANAGEMENT INCENTIVE PLAN

The Company sets certain earnings per share objectives, subject to
adjustments for certain factors. Bonuses are paid depending on the extent to
which plan objectives are achieved. If such objectives are fully achieved for
1997, bonuses of 50% of base salary would be paid to participants, of which one-
half would be deferred for one year subject to forfeiture (and reallocation to
other participants) in the event of certain terminations of employment.

EQUITY-BASED COMPENSATION

STOCK OPTION PLAN

This plan provides additional incentives to maximize stockholder value. The
plan also utilizes vesting periods to encourage key employees to continue in the
employ of the Company. All options become exercisable in one-third increments 15
months, 30 months and 45 months after the date of grant. The Company grants
stock options to a broad-based population of senior and middle management
employees. In determining the size of incentive awards to individual key
employees, the Stock Option Committee considers a number of factors, including:

1. Level of job responsibilities;

2. Past performance;

3. Size and frequency of grants by comparable companies;

4. Salary level;

5. Corporate performance, as measured by various tests of profitability such as
operating income, net income and earnings per share; and

6. Size of any prior grants.

EXECUTIVE COMPENSATION COMMITTEE STOCK OPTION COMMITTEE

Manfred Steinfeld, Chairman Robert L. Haag
Robert L. Haag Herbert L. Roth
Trisha Wilson

PERFORMANCE GRAPH

The performance graph below shall not be deemed incorporated by reference by
any general statement incorporating this Proxy Statement by reference into any
filing under the Acts, except to the extent that the Company specifically
incorporates this information by reference, and shall not otherwise be deemed
filed under such Acts.

The graph below compares cumulative total return (assuming reinvestment of
dividends) on the Company's Common Stock, for the five-year period shown,
compared with the Standard & Poor's 500 Index and the Standard & Poor's
Lodging-Hotels Index (fiscal years ending December 31), assuming $100 invested
on January 1, 1992 in the Company's Common Stock and in each index.

EDGAR REPRESENTATION OF DATA POINTS USED IN PRINTED GRAPHIC

SHELBY WILLIAMS
INDUSTRIES, INC. S&P 500 S&P LODGING-HOTELS

1991 100.0 100.0 100.0
1992 173.6 107.6 140.7
1993 249.2 118.5 262.1
1994 151.3 120.0 233.1
1995 217.4 165.1 275.6
1996 232.2 203.1 328.3

BOARD MEETINGS AND COMMITTEES

The Board of Directors has four standing committees: the executive committee,
the audit committee, the executive compensation committee and the stock option
committee. The function of the executive committee is to exercise the power and
authority of the Board of Directors as may be necessary during intervals between
meetings of the Board of Directors, subject to such limitations as are provided
by law, the Company's By-laws or resolutions of the Board of Directors. The
function of the audit committee is to review with the independent auditors of
the Company the scope and adequacy of the audit of the Company's accounts to be
made by such auditors and the accounting practices, procedures and policies of
the Company. The function of the executive compensation committee is to examine
and make recommendations to the Board as to the compensation to be paid to the
executives of the Company. The function of the stock option committee is to
grant options under and administer the Company's stock option plans and to have
responsibility with respect to the determination and amount of any contribution
to the Company's ESOP. The Company does not have a nominating committee.
The Board of Directors met four times and the audit committee, the stock
option committee and the executive compensation committee each met once during
1996. The exective committee did not meet formally in 1996. All directors
attended at least 75% of the aggregate of such Board and committee meetings of
which they were members.

CERTAIN TRANSACTIONS

William B. Kaplan, a director of the Company, is chairman and CEO and 50%
shareholder of Senior Lifestyle Corporation ("SLC"). Affiliates of SLC have
selected and from time to time in the future may select the Company's products
for purchase by building projects managed, but not owned, by such affiliates.
Neither Mr. Kaplan, SLC nor such affiliates receive any compensation from the
Company for such selections.
Mr. Kaplan is also the president and one of the principal owners of Senior
Suites Chicago Corporation, the general partner (with a 1% interest) of certain
limited partnerships which have developed and constructed residential projects
for seniors that opened for occupancy in 1996. The limited partnerships have
purchased products from the Company in the normal course of business. Because
these limited partnerships had little or no revenues in their fiscal years ended
May 31, 1996, the amounts paid to the Company, while in each case less than
$60,000 and less than 1% of total project development budgets, exceeded 5% of
each limited partnership's unaudited revenues for fiscal 1996. The entities and
amounts of purchases from the Company were as follows: Senior Suites Chicago
South Shore Limited Partnership, $21,434 in fiscal 1996; and Senior Suites
Chicago Central Station Limited Partnership, $8,305 in fiscal 1996 and $37,306
in fiscal 1997 (through February 24, 1997).
Douglas A. Parker, a director of the Company, is president and CEO and was
prior to January, 1997, a more than 10% stockholder of Leonard Parker Company,
Inc. ("LPC"). LPC purchased products from the Company for resale in the normal
course of business in 1996 and such purchases are continuing in 1997. Net sales
by the Company to LPC in 1996 amounted to approximately $4,866,000.
Trisha Wilson, a director of the Company, has recommended or specified and
from time to time in the future may recommend or specify the Company's products
for projects in connection with which she or her company renders interior
architectural hospitality design services. Neither Ms. Wilson nor her company
receives any compensation from the Company for such recommendations or
specifications.

PROPOSAL TO RATIFY SELECTION OF INDEPENDENT AUDITORS

The Board of Directors has selected the firm of Ernst & Young LLP as
independent auditors for the current fiscal year. Ernst & Young LLP served in
this capacity for 1996.
A representative of Ernst & Young LLP is expected to be present at the annual
meeting and to be available to respond to any appropriate questions raised at
the meeting and make a statement if he desires to do so.

PROPOSALS OF STOCKHOLDERS

Proposals of stockholders intended to be presented at the next annual meeting
must be received by the Company for inclusion in the Company's proxy statement
and form of proxy relating to that meeting not later than November 24, 1997.

GENERAL

The Company will bear the cost of solicitation of proxies. In addition to
being solicited by mail, proxies may be solicited personally or by telephone or
telegraph. The Company will reimburse brokerage houses and other custodians,
nominees and fiduciaries for forwarding proxy materials to principals in
obtaining their proxies.
The Board of Directors is not aware of any matter which is to be presented for
action at the meeting other than the matters set forth herein. Should any other
matter requiring a vote of the stockholders arise, the proxies in the enclosed
form confer upon the person or persons entitled to vote the shares represented
by such proxies discretionary authority to vote the same in respect of any such
other matter in accordance with their best judgment in the interest of the
Company.

Walter Roth
SECRETARY
Dated: March 24, 1997

SHELBY WILLIAMS INDUSTRIES, INC.

ANNUAL MEETING OF STOCKHOLDERS - MAY 6, 1997
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF DIRECTORS

The stockholder of SHELBY WILLIAMS INDUSTRIES, INC., signing the reverse side of
this Proxy, hereby appoints PAUL N. STEINFELD, ROBERT P. COULTER and WALTER
ROTH, each with full power of substitution, as attorneys and proxies to vote all
shares of stock of said Company which the undersigned is entitled to vote at the
Annual Meeting of Stockholders of said Company to be held on Tuesday, May 6,
1997, at 9:30 a.m. at 11-111 Merchandise Mart, Chicago, Illinois, or at any
adjournments thereof, with all powers the stockholder would possess if
personally present, as indicated on the reverse side of this Proxy, and for the
transaction of such other business as may properly come before said meeting or
any adjournment thereof, all as set forth in the March 24, 1997 Proxy Statement
for said meeting. A majority of the members of said proxy committee who shall
be present in person or by substitute at said meeting, or in case but one shall
be present then that one, shall have and exercise all the powers of said proxy
committee.

THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED AS DIRECTED. BUT IF NO
DIRECTION IS GIVEN, THIS PROXY WILL BE VOTED "FOR" PROPOSALS 1 AND 2 DESCRIBED
HEREIN. ON OTHER MATTERS THAT MAY COME BEFORE SAID MEETING, THIS PROXY WILL BE
VOTED IN THE DISCRETION OF THE ABOVE NAMED PERSONS.

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PLEASE VOTE, DATE, SIGN ON REVERSE, AND RETURN PROMPTLY IN THE ENCLOSED
ENVELOPE.
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PLEASE INDICATE ANY CHANGE OF ADDRESS BELOW:

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/X/ PLEASE MARK VOTES
AS IN THIS EXAMPLE
THIS PROXY IS SOLICITED BY THE BOARD OF DIRECTORS.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR PROPOSALS 1 AND 2.

1. Election of Directors. Withheld
------------------------- For all From all For all
SHELBY WILLIAMS ROBERT P. COULTER, ROBERT L. HAAG, Nominees Nominees Except
INDUSTRIES, INC. WILLIAM B. KAPLAN, DOUGLAS A. PARKER,
------------------------- HERBERT L. ROTH, MANFRED STEINFELD, / / / / / /
PAUL N. STEINFELD, TRISHA WILSON

NOTE: If you do not wish your shares voted "FOR" a particular
nominee, mark the "FOR ALL EXCEPT" box and strike a line through that
nominee's name. Your shares shall be voted for the remaining
nominees.

For Against Abstain
RECORD DATE SHARES: 2. To ratify the selection of Ernst & Young LLP
as independent auditors. / / / / / /

Please sign name exactly as it appears on this Proxy. Only one of
several joint owners need sign. Fiduciaries should give full title.
Corporations, partnerships or other entities should sign in the name
of the entity by an authorized person.

Please be sure to sign and date this Proxy. Date
---------
Mark box at right if an address change has been noted on the / /
- ----------------------------------------------------------- reverse side of this card.
Stockholder sign here Co-owner sign here

DETACH CARD DETACH CARD

SHELBY WILLIAMS INDUSTRIES, INC.

Dear Stockholder,

Please mark the boxes on this proxy card to indicate how your shares will be
voted. Then sign the card, detach it and return your proxy vote in the enclosed
postage paid envelope.

Sincerely,

Shelby Williams Industries, Inc.