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Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
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MIC-Info: RSA-MD5,RSA,
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<SEC-DOCUMENT>0001330489-05-000001.txt : 20050621
<SEC-HEADER>0001330489-05-000001.hdr.sgml : 20050621
<ACCEPTANCE-DATETIME>20050621163236
ACCESSION NUMBER:		0001330489-05-000001
CONFORMED SUBMISSION TYPE:	3
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20050621
FILED AS OF DATE:		20050621
DATE AS OF CHANGE:		20050621

ISSUER:		

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			PALMETTO BANCSHARES INC
		CENTRAL INDEX KEY:			0000706874
		STANDARD INDUSTRIAL CLASSIFICATION:	STATE COMMERCIAL BANKS [6022]
		IRS NUMBER:				742235055
		STATE OF INCORPORATION:			SC
		FISCAL YEAR END:			1231

	BUSINESS ADDRESS:	
		STREET 1:		301 HILLCREST DR
		STREET 2:		P O BOX 49
		CITY:			LAURENS
		STATE:			SC
		ZIP:			29360
		BUSINESS PHONE:		8649844551

REPORTING-OWNER:	

	OWNER DATA:	
		COMPANY CONFORMED NAME:			Ellison William Michael
		CENTRAL INDEX KEY:			0001330489

	FILING VALUES:
		FORM TYPE:		3
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-26016
		FILM NUMBER:		05908306

	BUSINESS ADDRESS:	
		BUSINESS PHONE:		864-984-4551

	MAIL ADDRESS:	
		STREET 1:		301 HILLCREST DRIVE
		CITY:			LAURENS
		STATE:			SC
		ZIP:			29360
</SEC-HEADER>
<DOCUMENT>
<TYPE>3
<SEQUENCE>1
<FILENAME>primary_doc.xml
<DESCRIPTION>PRIMARY DOCUMENT
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>3</documentType>

    <periodOfReport>2005-06-21</periodOfReport>

    <noSecuritiesOwned>0</noSecuritiesOwned>

    <issuer>
        <issuerCik>0000706874</issuerCik>
        <issuerName>PALMETTO BANCSHARES INC</issuerName>
        <issuerTradingSymbol>n/a</issuerTradingSymbol>
    </issuer>

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001330489</rptOwnerCik>
            <rptOwnerName>Ellison William Michael</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>301 HILLCREST DRIVE</rptOwnerStreet1>
            <rptOwnerStreet2></rptOwnerStreet2>
            <rptOwnerCity>LAURENS</rptOwnerCity>
            <rptOwnerState>SC</rptOwnerState>
            <rptOwnerZipCode>29360</rptOwnerZipCode>
            <rptOwnerStateDescription></rptOwnerStateDescription>
        </reportingOwnerAddress>
        <reportingOwnerRelationship>
            <isDirector>0</isDirector>
            <isOfficer>1</isOfficer>
            <isTenPercentOwner>0</isTenPercentOwner>
            <isOther>0</isOther>
            <officerTitle>Executive Vice President</officerTitle>
        </reportingOwnerRelationship>
    </reportingOwner>

    <nonDerivativeTable>
        <nonDerivativeHolding>
            <securityTitle>
                <value>Common Stock, $5 Par Value</value>
            </securityTitle>
            <postTransactionAmounts>
                <sharesOwnedFollowingTransaction>
                    <value>5260</value>
                </sharesOwnedFollowingTransaction>
            </postTransactionAmounts>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </nonDerivativeHolding>
    </nonDerivativeTable>

    <derivativeTable>
        <derivativeHolding>
            <securityTitle>
                <value>Stock Options</value>
            </securityTitle>
            <conversionOrExercisePrice>
                <value>13</value>
            </conversionOrExercisePrice>
            <exerciseDate>
                <footnoteId id="F1"/>
            </exerciseDate>
            <expirationDate>
                <footnoteId id="F2"/>
            </expirationDate>
            <underlyingSecurity>
                <underlyingSecurityTitle>
                    <value>Common Stock, $5 Par Value</value>
                </underlyingSecurityTitle>
                <underlyingSecurityShares>
                    <value>5000</value>
                </underlyingSecurityShares>
            </underlyingSecurity>
            <ownershipNature>
                <directOrIndirectOwnership>
                    <value>D</value>
                </directOrIndirectOwnership>
            </ownershipNature>
        </derivativeHolding>
    </derivativeTable>

    <footnotes>
        <footnote id="F1">Options granted during Q1 2000.  Options vest 20% at the end of each calendar year following grant date.</footnote>
        <footnote id="F2">Unexersized options expire ten years from date of grant.</footnote>
    </footnotes>

    <ownerSignature>
        <signatureName>Lauren Slaughter, with Power of Attorney, VP Finance and Accounting, The Palmetto Bank, a wholly owned subsidiary of Palmetto Bancshares, Inc.</signatureName>
        <signatureDate>2005-06-21</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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