Exhibit 99.1

Family Dollar Reports Record Second Quarter Earnings

• Earnings Per Diluted Share Increase 21.0% To $0.98
• Net Income Increases 9.8%
• Management Updates Earnings Guidance For FY11

MATTHEWS, N.C.--(BUSINESS WIRE)--March 30, 2011--Family Dollar Stores, Inc. (NYSE: FDO) today reported that net income for the second quarter of fiscal 2011 ended February 26, 2011, increased 9.8% to $123.2 million compared with net income of $112.2 million for the second quarter of fiscal 2010. Net income per diluted share for the quarter increased 21.0% to $0.98 compared with $0.81 for the second quarter of fiscal 2010 ended February 27, 2010.

“Over the last several years, we have accelerated capability-building investments and increased our efforts to improve the in-store shopping experience. These investments have provided a solid foundation for the successful launch of our strategic plan to re-accelerate revenue growth, expand operating margins and optimize our capital structure,” said Howard Levine, Chairman and CEO. “Our performance year-to-date illustrates that we are effectively leveraging these enhanced capabilities and executing well against our business plan and delivering superior value for shareholders.”

Second Quarter Results

As previously reported, sales for the second quarter of fiscal 2011 were approximately $2.263 billion, or 8.3% above sales of approximately $2.090 billion for the second quarter of fiscal 2010. Comparable store sales increased 5.1%. The increase in comparable store sales was a result of increased customer traffic, as measured by the number of register transactions, and a modest increase in the value of the average customer transaction. Although January sales were impacted by winter storms, February sales benefited from early spring-like weather. Sales during the quarter were strongest in the Consumable and Seasonal categories.

The gross profit margin, as a percentage of net sales, was 35.7% in the second quarter of fiscal 2011 compared to 35.4% in the second quarter of fiscal 2010. The improvement in gross profit, as a percentage of sales, was a result of lower inventory shrinkage which more than offset higher freight expense. The impact of stronger sales of lower-margin consumables was offset by higher purchase markups.

Selling, general and administrative (“SG&A”) expenses increased 8.5% to $607.0 million in the second quarter of fiscal 2011 compared to $559.5 million in the second quarter of fiscal 2010. As a percentage of net sales, SG&A expenses were approximately flat in the second quarter of fiscal 2011 as compared the second quarter of fiscal 2010. Most expenses, including occupancy costs, were leveraged during the quarter as a result of a comparable store sales increase of 5.1%. These improvements were offset by investments to support revenue growth, including expanded store operating hours, store renovations and the acceleration of new store growth. Insurance expense in the quarter also increased as a percentage of sales.

The Company’s inventories at February 26, 2011, were $1,060.2 million, or 13.4% more than inventories of $935.3 million at February 27, 2010. Average inventory per store at the end of the second quarter of fiscal 2011 was approximately 10% higher than the average inventory per store at the end of the second quarter of fiscal 2010. The increase in inventories was primarily a result of investments to support higher in-stock levels in stores and expansions of consumable assortments.

In the first half of fiscal 2011, capital expenditures were $139.0 million compared with $82.9 million in the first half of fiscal 2010. During the first half of fiscal 2011, the Company opened 146 new stores and closed 43 stores compared to 86 new stores and 52 closings in the first half of fiscal 2010. In the first half of fiscal 2011, the Company completed 313 store renovations, including 140 renovations during the second quarter.

As part of its previously announced $750 million share repurchase authorization, the Company repurchased 8.9 million shares at a total cost of approximately $408.0 million during the first half of fiscal 2011. As of February 26, 2011, the Company had authorization to purchase up to an additional $349.8 million of its common stock.

Outlook

For the third quarter, the Company expects that comparable sales for the quarter will increase between 5% and 7% and that earnings per share will be between $0.92 and $0.97 compared with $0.77 in the third quarter of fiscal 2010.

For the full year, the Company expects that earnings per share will be between $3.13 and $3.23 compared with $2.62 in fiscal 2010. The Company's outlook for fiscal 2011 is based on the following assumptions which may or may not prove valid:

• An increase in net sales of between 8% and 10%;
• An increase in comparable store sales of between 5% and 7%;
• Approximately 300 new store openings and 80-100 store closings;
• A modest increase in operating profit, as a percentage of sales;
• Net interest expense of approximately $20 million;
• An effective income tax rate of between 37% and 37.5%;
• Weighted average diluted shares of approximately 124 million, reflecting additional share repurchases in fiscal 2011; and
• Capital expenditures of between $300 million and $350 million.

Cautionary Statements

Certain statements contained in this press release are “forward-looking statements” that are subject to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. These forward-looking statements address certain plans, activities or events which the Company expects will or may occur in the future and relate to, among other things, the state of the economy, the Company’s investment and financing plans, net sales, comparable stores sales, cost of sales, SG&A expenses, earnings per diluted share, dividends, and share repurchases. Various risks, uncertainties and other factors could cause actual results to differ materially from those expressed in any forward-looking statement. Consequently, all of the forward-looking statements made by the Company in this and in other documents or statements are qualified by factors, risks and uncertainties, including, but not limited to, those set forth under the headings titled “Cautionary Statement Regarding Forward-Looking Statements” and “Risk Factors” in the Company’s most recent Annual Report on Form 10-K and subsequent Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission up to the date of this release.

Readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date of this press release. The Company does not undertake to update or revise these forward-looking statements even if experience or future changes make it clear that projected results expressed or implied in such statements will not be realized, except as may be required by law.

Second Quarter Earnings Conference Call Information

The Company intends to host a conference call with investors today at 10:00 A.M. ET to discuss the results. If you wish to participate, please call (800) 779-6561 for domestic US calls and (517) 308-9046 for international calls at least 10 minutes before the call is scheduled to begin. The passcode for the conference call is FAMILY DOLLAR.

There will also be a live webcast of the conference call with accompanying slides that can be accessed at the following link:

http://www.familydollar.com/investors.aspx?p=irhome.

A replay of the webcast will be available at the same address noted above after 2:00 P.M. ET, today.

About Family Dollar

Beginning with one store in 1959 in Charlotte, North Carolina, the Company currently operates more than 6,800 stores in 44 states. Family Dollar Stores, Inc., a Fortune 500 company, is based in Matthews, North Carolina, just outside of Charlotte and is a publicly held company with common stock traded on the New York Stock Exchange under the symbol FDO. For more information, please visit www.familydollar.com.

CONTACT:
Family Dollar Stores, Inc.
Investor Contact:
Kiley F. Rawlins, CFA, 704-849-7496
krawlins@familydollar.com
or
Media Contact:
Josh Bravermanm, 704-814-3447
jbraverman@familydollar.com