
<PAGE>   1
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                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549


                                    FORM 10-K

                ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF
                       THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31, 1997        Commission file number 1-878


                                BLAIR CORPORATION

    Incorporated in Delaware         I.R.S. Employer Identification Number:

      220 Hickory Street
    Warren, Pennsylvania   16366                  25-0691670
       (814) 723-3600

Securities registered pursuant to Section 12(b) of the Act:

<TABLE>
<CAPTION>
                                                    NAME OF EACH EXCHANGE
         TITLE OF EACH CLASS                         ON WHICH REGISTERED
         -------------------                         -------------------
<S>                                                 <C>
Common Stock, without nominal or par value           American Stock Exchange
</TABLE>

Securities registered pursuant to Section 12(g) of the Act:        None

     Indicate by check mark whether the registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to such
filing requirements for the past 90 days. Yes   X   No 
                                              -----    -----

     Indicate by check mark if disclosure of delinquent filers pursuant to Item
405 of Regulation S-K is not contained herein, and will not be contained, to the
best of the registrant's knowledge, in definitive proxy or information
statements incorporated by reference in Part III of this Form 10-K or any
amendment to this Form 10-K.   X
                             -----

     The aggregate market value of the voting stock held by nonaffiliates of the
registrant as of February 27, 1998 was $150,961,002. There were 8,987,343
shares of common stock outstanding as of February 27, 1998, which amount
represents the figure reported as outstanding by the Company's transfer agent as
of the record date (9,007,366 shares) reduced by 20,023 shares repurchased by
the Company prior to the record date but not reflected on the books of the
transfer agent. 

                      DOCUMENTS INCORPORATED BY REFERENCE

     The Annual Report to Stockholders for the fiscal year ended December 31,
1997 (the "Annual Report") is incorporated by reference into Part II and Part IV
of this Form 10-K. Portions of the Proxy Statement for the 1998 Annual Meeting
of Stockholders (the "Proxy Statement") are incorporated by reference into Part
III of this Form 10-K.

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<PAGE>   2

                                     PART I

ITEM 1. BUSINESS

     (A) GENERAL.

     Blair Corporation (the "Company") was founded in 1910 by John L. Blair,
Sr., and was incorporated in 1924 under the laws of the state of Delaware. The
Company's business consists of the sale of fashion apparel for men and women,
plus a wide range of home products, primarily through direct mail merchandising.
The Company operates two retail stores, one in Pennsylvania and one in Delaware,
and two outlet stores in Pennsylvania. The Company employs approximately 2,200
people.

     (B) INFORMATION REGARDING INDUSTRY SEGMENTS.

     The Company's business consists of only one industry segment, which is the
retail and direct mail merchandising of men's and women's fashion apparel and
home products.

     (C) DESCRIPTION OF BUSINESS.

     The Company markets a wide range of merchandise, manufactured by a number
of independent suppliers, both domestic and foreign. Most of these suppliers
have been associated with the Company for many years and manufacture products
based upon the Company's specifications. Suppliers are selected in accordance
with their ability to produce high quality products in a cost-effective manner.

     Historically, the Company has marketed its products by mailing letters and
color folders depicting the current styles of womenswear (such as coordinates,
dresses, tops, pants, skirts, lingerie, sportswear, suits, jackets, outerwear
and shoes); menswear (such as suits, shirts, outerwear, active wear, slacks,
shoes, and accessories); and home products (such as bedspread ensembles,
draperies, furniture covers, area rugs, bath accessories, kitchenware, tools,
exercise and personal care items) directly to existing and prospective
customers. Sales of the menswear and womenswear products accounted for
approximately 87% of the Company's total sales in 1997, and sales of home
products accounted for the remaining 13% (approximately). Media and co-op
prospect advertising programs continue to be used as components of the Company's
customer acquisition strategy. In 1993, the Company tested a catalog format to
market its home products and other non-apparel merchandise, which was
well-received by its existing customer base. In 1995, the Company tested a
catalog format to market its menswear and in early 1996, the Company tested a
catalog format to market its womenswear. The success of the pilot catalog
mailing programs prompted the Company to continually expand its catalog
distribution since 1993, and the Company anticipates that catalog mailings will
outnumber letter mailings in 1998.

     Orders for merchandise are processed at the Company's corporate offices in
Warren, Pennsylvania. Letter mailings originate from the Company's Mailing
Center, and orders are filled and mailed from the Company's Distribution Center,
both in nearby Irvine, Pennsylvania. Catalog mailings are mailed from commercial
printers engaged by the Company. The Company serves customers throughout the
fifty states.

     The Company's outlet stores enable it to more efficiently promote and
liquidate discontinued, overstocked and returned merchandise. The Delaware
retail store is the only Company retail facility located outside of its home
state of Pennsylvania.

     The Company considers its merchandise to be low/medium-priced and competes
for sales with other direct mail businesses, retail department stores, specialty
shops and discount store chains. The Company competes based on its sales
expertise, customer service, pricing, customer credit privileges and diverse
product mix.

     During 1997, the Company continued its efforts to broaden its customer
information systems. The marketing and credit departments are continually
updated in order to enhance the Company's ability to market to both customers
and prospects.

     (D) FOREIGN OPERATIONS AND EXPORT SALES.

     The Company does not derive any revenue from sales of merchandise outside
of the United States.


<PAGE>   3


ITEM 2. PROPERTIES

     The Company owns the following properties:

     1.   Blair Headquarters (220 Hickory Street, Warren, Pennsylvania) -- a
          284,000 square foot multi-story brick facility containing the
          Company's corporate offices and Accounting, Advertising, Information
          Services, Human Resources, Merchandise, Order Handling and Planning
          departments.

     2.   Blair Distribution Center (Route 62, Irvine, Pennsylvania) -- a
          542,275 square foot cement block and sheet metal warehouse and
          distribution facility.

     3.   Blair Mailing Center (Route 62, Irvine, Pennsylvania) -- a 293,400
          square foot cement block and sheet metal mailing facility.

     4.   Blair Warehouse Outlet (Route 62, Starbrick, Pennsylvania) -- a 53,250
          square foot metal warehouse outlet facility.

     5.   Blair Warehouse Outlet (Millcreek Mall, Erie, Pennsylvania) -- a
          38,660 square foot block and brick warehouse outlet facility.

     6.   Bell Warehouse Building (Liberty Street, Warren, Pennsylvania) -- a
          9,000 square foot metal warehouse facility.

     7.   Starbrick Warehouse Building (Route 62, Starbrick, Pennsylvania) -- a
          12,000 square foot metal warehouse facility.

     The Company leases the following properties:

     1.   Blair Retail Store (Wilmington, Delaware) -- a 11,765 square foot
          retail facility.

     2.   Warehouse Building (Route 62, Starbrick, Pennsylvania) -- a 30,000
          square foot metal warehouse facility. 

     3.   Telephone Call Center (Erie, Pennsylvania) -- a 21,870 square foot
          metal call center facility.

     4.   Telephone Call Center (Franklin, Pennsylvania) -- a 17,500 square foot
          cement block call center facility.

     In addition, the Company's wholly-owned subsidiary, Blair Holdings, Inc.,
leases approximately 600 square feet of office space in Newark, Delaware, which
it uses as its principal office.

     Management believes that these properties are capable of meeting the
Company's anticipated needs for the foreseeable future.

ITEM 3. LEGAL PROCEEDINGS

     Not applicable.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

     No matters were submitted to a vote of security holders, through the
solicitation of proxies or otherwise, during the fourth quarter of the fiscal
year covered by this report.

                                     PART II

ITEM 5. MARKET FOR THE REGISTRANT'S COMMON EQUITY AND RELATED 
        STOCKHOLDER MATTERS

     The information required by this item is incorporated by reference to page
14 of the Company's 1997 Annual Report to Stockholders.

ITEM 6. SELECTED FINANCIAL DATA

     The information required by this item is incorporated by reference to page
14 of the Company's 1997 Annual Report to Stockholders.


<PAGE>   4


ITEM 7. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND 
        RESULTS OF OPERATIONS

     The information required by this item is incorporated by reference to pages
15 through 18 of the Company's 1997 Annual Report to Stockholders.

ITEM 7A. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

     Not applicable.

ITEM 8. FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

     The information required by this item is incorporated by reference to pages
7 through 14 of the Company's 1997 Annual Report to Stockholders.

ITEM 9. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
        FINANCIAL DISCLOSURE

     None.

                                    PART III

ITEM 10. DIRECTORS AND EXECUTIVE OFFICERS OF THE COMPANY

     Information regarding directors and executive officers of the Company
appearing under the caption "Election of Directors" in the Company's Proxy
Statement for the 1998 Annual Meeting of Stockholders (the "1998 Proxy
Statement") is hereby incorporated by reference.

ITEM 11. EXECUTIVE COMPENSATION

     Information appearing under the caption "Executive Compensation" in the
1998 Proxy Statement is hereby incorporated by reference.

ITEM 12. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT

     Information setting forth the security ownership of certain beneficial
owners and management appearing under the captions "Security Ownership of
Certain Beneficial Owners" and "Security Ownership of Management" in the 1998
Proxy Statement is hereby incorporated by reference.

ITEM 13. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

     Not applicable.

                                     PART IV

ITEM 14. EXHIBITS, FINANCIAL STATEMENT SCHEDULES, AND REPORTS ON FORM 8-K

     (A) EXHIBITS AND FINANCIAL STATEMENTS AND SCHEDULES.

     (1) Financial Statements. The Company's consolidated financial statements
to be included in Part II, Item 8 are incorporated herein by reference to the
Company's 1997 Annual Report to Stockholders, a copy of which accompanies this
report on Form 10-K.

     (2) Financial Statement Schedules. SCHEDULE II -- VALUATION AND QUALIFYING
ACCOUNTS is being filed as part of this report on Form 10-K, and should be read
in conjunction with the consolidated financial statements of the Company
described in Item 14(a)(1) above.


<PAGE>   5



     All other schedules set forth in the applicable accounting regulations of
the Securities and Exchange Commission either are not required under the related
instructions or are not applicable and, therefore, have been omitted.

     (3) List of Exhibits.

          3 (i)  Certificate of Incorporation of the Company

          3 (ii) Bylaws of the Company

          *10    Stock Accumulation and Deferred Compensation Plan for 
                 Directors

          *11    Computation of Earnings per Share (incorporated by reference 
                 to page 7 of the 1997 Annual Report to Stockholders)

          *13    1997 Annual Report to Stockholders

           21    Subsidiaries of Registrant

          *23    Consents of Experts and Counsel

          *27    Financial Data Schedule

     (B) REPORTS ON FORM 8-K.

     The registrant has filed no Forms 8-K during the quarter ended December 31,
1997.

     (C) EXHIBITS.

     All exhibits listed above were previously filed with the Commission, except
for those marked with an asterisk, which are being filed with this Form 10-K.


<PAGE>   6


                                   SIGNATURES


     Pursuant to the requirements of Section 13 or 15(d) of the Securities
Exchange Act of 1934, as amended, the registrant has duly caused this report to
be signed on its behalf by the undersigned, thereunto duly authorized.


                                        BLAIR CORPORATION
                                        (Registrant)



Date:  March 20, 1998                By: /s/ KENT R. SIVILLO
                                         -----------------------------------
                                             Kent R. Sivillo
                                         Vice President and Treasurer

         Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, this report has been signed below by the following persons on behalf of
the registrant and in the capacities and on the date indicated.


Date:  March 20, 1998                By:     /s/ MURRAY K. MCCOMAS
                                         -----------------------------------
                                                 Murray K. McComas
                                               President and Director
                                           (Principal Executive Officer)


Date:  March 20, 1998                By:     /s/ BLAIR T. SMOULDER
                                         -----------------------------------
                                                 Blair T. Smoulder
                                             Executive Vice President
                                                  and Director


Date:  March 20, 1998                By:     /s/ MICHAEL J. SAMARGYA
                                         -----------------------------------
                                                 Michael J. Samargya
                                            Vice President, Information
                                               Services, and Director


Date:  March 20, 1998                By:     /s/ STEVEN M. BLAIR
                                         -----------------------------------
                                                 Steven M. Blair
                                              Vice President, Order
                                              Handling, and Director


Date:  March 20, 1998                By:     /s/ JOHN E. ZAWACKI
                                         -----------------------------------
                                                 John E. Zawacki
                                           Vice President, Womenswear,
                                                  and Director


Date:  March 20, 1998                By:     /s/ DAVID A. BLAIR
                                         -----------------------------------
                                                 David A. Blair
                                            Secretary and Director

<PAGE>   7


Date:  March 20, 1998                By:     /s/ KENT R. SIVILLO
                                         -----------------------------------
                                                 Kent R. Sivillo
                                                 Vice President,
                                             Treasurer and Director
                                           (Principal Financial and
                                              Accounting Officer)


Date:  March 20, 1998                By:     /s/ ROBERT D. CROWLEY
                                         -----------------------------------
                                                 Robert D. Crowley
                                             Vice President, Menswear,
                                                   and Director


Date:  March 20, 1998                By:     /s/ THOMAS P. MCKEEVER
                                         -----------------------------------
                                                 Thomas P. McKeever
                                          Vice President, Corporate Affairs
                                          and Human Resources, and Director



<PAGE>   8

                           Annual Report on Form 10-K
                         Item 14(a) (1) and (2), and (d)

         List of Financial Statements and Financial Statement Schedules

                        Blair Corporation and Subsidiary
                              Warren, Pennsylvania

                          Year ended December 31, 1997



<PAGE>   9


                        Blair Corporation and Subsidiary

         List of Financial Statements and Financial Statement Schedules

                   Form 10-K -- Item 14(a)(1) and (2), and (d)

The following consolidated financial statements of Blair Corporation, included
in the annual report of the registrant to its stockholders for the year ended
December 31, 1997, are incorporated by reference in Item 8:

         --  Consolidated Balance Sheets -- December 31, 1997 and 1996

         --  Consolidated Statements of Income -- Years ended 
             December 31, 1997, 1996 and 1995

         --  Consolidated Statements of Stockholders' Equity -- Years ended 
             December 31, 1997, 1996 and 1995

         --  Consolidated Statements of Cash Flows -- Years ended 
             December 31, 1997, 1996 and 1995

         --  Notes to Consolidated Financial Statements -- December 31, 1997

The following financial statement schedule of Blair Corporation is included in
Item 14(d):

         --  Schedule II -- Valuation and Qualifying Accounts

All other schedules for which provision is made in the applicable accounting
regulation of the Securities and Exchange Commission are not required under the
related instructions or are inapplicable, and therefore have been omitted.


<PAGE>   10


                        Blair Corporation and Subsidiary

                                   Schedule II

                        Valuation and Qualifying Accounts
                                December 31, 1997

<TABLE>
<CAPTION>
 COLUMN A                              COLUMN B             COLUMN C                COLUMN D            COLUMN E
 -------------------------------------------------------------------------------------------------------------------
                                                              ADDITIONS-
                                        BALANCE AT            CHARGED TO                                BALANCE
                                         BEGINNING            COSTS AND           DEDUCTIONS-           AT END
 DESCRIPTION                             OF PERIOD            EXPENSES             DESCRIBE            OF PERIOD 
 -----------                            ----------           -----------          ------------         ---------
<S>                                    <C>                 <C>                   <C>                  <C>
 Year ended December 31, 1997:
     Allowance deducted from asset
      accounts (customer accounts
      receivable):
         For doubtful accounts          $37,272,572         $ 32,222,092(A)       $ 37,509,776(B)      $31,984,888
         For estimated loss on          
            returns                       7,192,000           94,114,182            94,811,182(C)        6,495,000
                                        -----------         ------------          ------------         -----------
 Totals                                 $44,464,572         $126,336,274          $132,320,958         $38,479,888
                                        ===========         ============          ============         ===========

 Year ended December 31, 1996:
     Allowance deducted from asset
      accounts (customer accounts
      receivable):
         For doubtful accounts          $40,508,071         $ 47,550,310(A)       $ 50,785,809(B)      $37,272,572
         For estimated loss on
            returns                       6,676,000          100,976,722           100,460,722(C)        7,192,000
                                        -----------         ------------          ------------         -----------
 Totals                                 $47,184,071         $148,527,032          $151,246,531         $44,464,572
                                        ===========         ============          ============         ===========

 Year ended December 31, 1995: 
     Allowance deducted from asset 
      accounts (customer accounts 
      receivable):
         For doubtful accounts          $32,256,161         $ 31,774,283(A)       $ 23,522,373(B)      $40,508,071
         For estimated loss on
            returns                       7,571,000           96,320,044            97,215,044(C)        6,676,000
                                        -----------         ------------          ------------         -----------
 Totals                                 $39,827,161         $128,094,327          $120,737,417         $47,184,071
                                        ===========         ============          ============         ===========
</TABLE>
----------

Note (A) -- Current year provision for doubtful accounts, charged against
            income.

Note (B) -- Accounts charged off, net of recoveries.

Note (C) -- Sales value of merchandise returned.



