-----BEGIN PRIVACY-ENHANCED MESSAGE-----
Proc-Type: 2001,MIC-CLEAR
Originator-Name: webmaster@www.sec.gov
Originator-Key-Asymmetric:
 MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen
 TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB
MIC-Info: RSA-MD5,RSA,
 Axiru/BTucl0gD/PquMjrEpjtbc4alfd4XfIsuglSBfSfSKC7zaiwxmpzfVFcuRg
 qkEGwhGpMxnqSIOFp2EjmQ==

<SEC-DOCUMENT>0001246078-08-000001.txt : 20080214
<SEC-HEADER>0001246078-08-000001.hdr.sgml : 20080214
<ACCEPTANCE-DATETIME>20080214162703
ACCESSION NUMBER:		0001246078-08-000001
CONFORMED SUBMISSION TYPE:	4
PUBLIC DOCUMENT COUNT:		1
CONFORMED PERIOD OF REPORT:	20080131
FILED AS OF DATE:		20080214
DATE AS OF CHANGE:		20080214

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:			BURNS RALPH M III
		CENTRAL INDEX KEY:			0001246078

	FILING VALUES:
		FORM TYPE:		4
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-26016
		FILM NUMBER:		08616808

	MAIL ADDRESS:	
		STREET 1:		C/O PALMETTO BANCSHARES INC
		STREET 2:		PO BOX 49 301 HILLCREST DRIVE
		CITY:			LAURENS
		STATE:			SC
		ZIP:			29360
</SEC-HEADER>
<DOCUMENT>
<TYPE>4
<SEQUENCE>1
<FILENAME>primary_doc.xml
<DESCRIPTION>PRIMARY DOCUMENT
<TEXT>
<XML>
<?xml version="1.0"?>
<ownershipDocument>

    <schemaVersion>X0202</schemaVersion>

    <documentType>4</documentType>

    <periodOfReport>2008-01-31</periodOfReport>

    <notSubjectToSection16>1</notSubjectToSection16>

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

    <reportingOwner>
        <reportingOwnerId>
            <rptOwnerCik>0001246078</rptOwnerCik>
            <rptOwnerName>BURNS RALPH M III</rptOwnerName>
        </reportingOwnerId>
        <reportingOwnerAddress>
            <rptOwnerStreet1>C/O PALMETTO BANCSHARES INC</rptOwnerStreet1>
            <rptOwnerStreet2>PO BOX 49 301 HILLCREST DRIVE</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>EVP Operations and Finance</officerTitle>
        </reportingOwnerRelationship>
    </reportingOwner>

    <remarks>Mr. Burns retired on January 31, 2008.</remarks>

    <ownerSignature>
        <signatureName>Lauren S Greer with POA, SVP The Palmetto Bank, a wholly-owned subsidiary of Palmetto Bancshares, Inc.</signatureName>
        <signatureDate>2008-02-14</signatureDate>
    </ownerSignature>
</ownershipDocument>
</XML>
</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
-----END PRIVACY-ENHANCED MESSAGE-----