UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                              Washington, DC 20549

                                    FORM 8-K

                                 CURRENT REPORT
     Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

         Date of Report (Date of earliest event reported): July 18, 2003
                                  -------------

                               Donegal Group Inc.
                     ---------------------------------------
             (Exact name of registrant as specified in its charter)

                                                                        

 Delaware                                     0-15341                      23-2424711
 ------------------                   -------------------------        -------------------
(State or other jurisdiction          (Commission file number)           (IRS employer
 of incorporation)                                                     identification no.)

1195 River Road, Marietta, Pennsylvania                        17547
- ---------------------------------------                        -------
(Address of principal executive offices)                       (Zip code)

         Registrant's telephone number, including area code: (888) 877-0600
                                                             --------------

                                       N/A
          -------------------------------------------------------------
          (Former name or former address, if changed since last report)

Item 7.  Financial Statements and Exhibits.

                  (c) Exhibits.

                  The following exhibit is filed herewith:

                  Exhibit No.                        Description

                        99.1                Press release issued by Donegal
                                            Group Inc. (the "Company") dated
                                            July 18, 2003

Item 12.          Results of Operations and Financial Condition.

         On July 18, 2003, the Company issued a press release regarding the
Company's financial results for its second quarter ended June 30, 2003. The
press release is attached as Exhibit 99.1 to this Form 8-K Current Report. The
information in this report shall not be deemed to be filed for purposes of
Section 18 of the Securities Exchange Act of 1934 or incorporated by reference
in any filing under the Securities Act of 1933.

                                   SIGNATURES

         Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.

                                        DONEGAL GROUP INC.

Date:   July 18, 2003                   By:/s/ Ralph G. Spontak
                                        ----------------------------------------
                                        Ralph G. Spontak, Senior Vice President,
                                        Chief Financial Officer and Secretary

                                  EXHIBIT INDEX

Exhibit
Number                  Description

    99.1                Press release dated July 18, 2003 issued by the Company.

                                                                  EXHIBIT 99.1

DONEGAL GROUP INC. ANNOUNCES RECORD EARNINGS FOR SECOND QUARTER

Ralph G. Spontak
Senior Vice President and Chief Financial Officer
Phone  (717) 426-1931
Fax      (717) 426-7009

                                                         For Immediate Release

         MARIETTA, Pennsylvania, July 18, 2003 - Donegal Group Inc.
(Nasdaq:  DGICA and DGICB) today reported record operating results for the
quarter and six months ended June 30, 2003.

         The Company's excellent underwriting results continued through the
second quarter of this year with the Company posting record quarterly net income
of $5,268,953, or $.56 per share on a diluted basis, compared to $3,178,834, or
$.35 per share on a diluted basis, in the second quarter of 2002.

         The Company's combined ratio continued to improve from the strong
results posted for the first quarter ending up the second quarter at an
exceptional 92.3%, compared to 99.3% for the second quarter of 2002. The
Company's loss ratio was an outstanding 61.2% for the second quarter 2003
compared to 69.7% for the second quarter of 2002, with both commercial and
personal lines showing improvement. The Company's expense ratio increased
slightly, due to higher underwriting based incentives, resulting in a ratio of
30.6% for the second quarter of 2003 compared to 29.4% for the second quarter of
2002. The Company's workers' compensation policy dividend ratio increased
slightly from 0.2% in the second quarter of 2002 to 0.5% in the second quarter
of 2003.

         The strong operational results helped the Company increase its book
value per common share to $15.49 as of June 30, 2003.

         "We are delighted that our expense control and underwriting efforts
have resulted in improvements in the results of both our personal and commercial
lines",  stated Donald H.  Nikolaus,  President and Chief  Executive  Officer of
Donegal Group,  "and even more pleased those  improvements  have resulted in our
annualized  return on equity  improving to 13 percent  through the first half of
this year."

         Net income of $9,113,385, or $.97 per share on a diluted basis, for the
first six month of 2003 represented the highest first half earnings in the
Company's history, compared to $5,359,550, or $.59 per share on a diluted basis
for the first six months of 2002. The Company's combined ratio for the six
months ended June 30, 2003 was 94.7%, compared to 100.5% for the six months
ended June 30, 2002, with all major lines of business showing improvement over
the prior year.

         Revenues for the second quarter of 2003 were $52,826,818, an increase
of 4.1% over a year earlier, with premiums earned for the second quarter of
$48,433,689, a 5.0% increase over the second quarter of 2002. The lower interest
rate environment impacted investment income which was down 10.6% to $3,315,710
compared to $3,710,282 for the second quarter of 2002 despite an increase in
average invested assets.

         Yesterday the Company's Board of Directors declared a regular quarterly
cash dividend of 11 cents per share of Class A Common Stock and 10 cents per
share of Class B Common Stock payable August 15, 2003 to shareholders of record
as of the close of business on August 1, 2003.

         The Company will hold a conference  call and webcast on Friday July 18,
2003,  beginning  at  11:00  A. M.  Eastern  Time.  You may  participate  in the
conference call by calling 1-800-901-5213  (International 617-786-2962) Passcode
I. D. 53873373.  An instant replay of the conference  call will be available for
10 days by calling 1-888-286-8010 (Passcode I. D. 71251761).

         All statements contained in this release that are not historic facts
are based on current expectations. Such statements are forward looking (as
defined in the Private Securities Litigation Reform Act of 1995) in nature and
involve a number of risks and uncertainties. Actual results may vary materially.
The factors that could cause actual results to vary materially include: The
ability of the company to maintain profitable operations, the adequacy of the
company's reserve for losses and loss adjusting expenses, business and economic
conditions in the company's primary operating areas, competition from various
insurance and non-insurance businesses, changes in regulatory requirements, and
other risks that may be described from time to time in the reports Donegal is
required to file with the Securities and Exchange Commission. Undue reliance
should not be placed on any such forward looking statements.

                  Donegal Group Inc. is a regional property-casualty insurance
holding company doing business in 14 Mid-Atlantic and Southern states through
its insurance subsidiaries Atlantic States Insurance Company and Southern
Insurance Company of Virginia.

                                 (Tables Follow)

                                                                                     

                                                                    Second Quarter Ended
                                                -------------------------------------------------------------
                                                          June 30,                       June 30,
                                                            2003                           2002
                                                ----------------------------- -------------------------------

Net premiums earned                                        $48,433,689                     $46,110,512
Investment income,
     net of expenses                                         3,315,710                       3,710,282
Realized investment gains                                      216,370                          60,481
Total revenues                                              52,826,818                      50,736,803

Net income                                                  $5,268,953                      $3,178,834

Net income per common share
     Basic                                                    $   0.57                        $   0.35
     Diluted                                                  $   0.56                        $   0.35

                                                                                      

                                                                      Six Months Ended
                                                -------------------------------------------------------------
                                                          June 30,                       June 30,
                                                            2003                           2002
                                                ----------------------------- -------------------------------

Net premiums earned                                       $ 96,362,570                    $ 91,562,772
Investment income,
     net of expenses                                         6,680,228                       7,440,586
Realized investment gains                                       85,890                         187,259
Total revenues                                             105,012,237                     100,770,849

Net income                                                  $9,113,385                     $ 5,359,550

Net income per common share
     Basic                                                    $   0.99                        $   0.59
     Diluted                                                  $   0.97                        $   0.59

                        Consolidated Statements of Income
                  (unaudited; in thousands, except share data)

                                                                                          

                                                                    Second Quarter Ended
                                                -------------------------------------------------------------
                                                          June 30,                          June 30,
                                                            2003                              2002
                                                ------------------------------ ------------------------------

Net premiums earned                                          $ 48,434                         $ 46,111
Investment income,
     net of investment expenses                                 3,316                            3,710
Realized investment gains                                         216                               61
Lease income                                                      211                              194
Service charge income                                             650                              661
                                                               ------                           ------
     Total revenues                                            52,827                           50,737
                                                               ------                           ------

Losses and loss expenses                                       29,658                           32,136
Amortization of deferred policy
     acquisition costs                                          7,545                            7,345
Other underwriting expenses                                     7,269                            6,189
Other expenses                                                    345                              211
Dividends                                                         228                              105
Interest                                                          307                              296
                                                               ------                           ------
     Total expenses                                            45,352                           46,282
                                                               ------                           ------

Income before income taxes                                      7,475                            4,455
     Income tax expense                                         2,206                            1,276
                                                                -----                            -----
Net income                                                  $  5,269                           $ 3,179
                                                            =========                          =======
Net income per common share
     Basic                                                   $  0.57                           $  0.35
                                                             --------                          -------
     Diluted                                                 $  0. 56                          $  0.35
                                                             --------                          -------

    Supplementary Financial Analysts' Data

Weighted average number of
   shares outstanding
     Basic                                                  9,269,029                        9,059,477
                                                            ---------                        ---------
     Diluted                                                9,424,050                        9,175,729
                                                            ---------                        ---------

Net written premiums                                         $ 53,184                         $ 51,652
                                                             --------                         --------

Book value per common share                                  $  15.49                         $  13.94
                                                             --------                         --------

                                                                                      

                                                                      Six Months Ended
                                                -------------------------------------------------------------
                                                          June 30,                         June 30,
                                                            2003                             2002
                                                ----------------------------- -------------------------------

Net premiums earned                                          $ 96,363                         $ 91,563
Investment income,
     net of investment expenses                                 6,680                            7,626
Realized investment gains                                          86                              187
Lease income                                                      413                              389
Service charge income                                           1,264                            1,191
Other Income                                                      206                             -
                                                              -------                          -------
                                                              105,012                          100,956
                                                              -------                          -------
    Total revenues

Losses and loss expenses                                       61,509                           63,434
Amortization of deferred policy
     acquisition costs                                         14,987                           14,730
Other underwriting expenses                                    14,292                           13,515
Other expenses                                                    675                              714
Dividends                                                         469                              571
Interest                                                          522                              621
                                                               ------                           ------
     Total expenses                                            92,454                           93,585
                                                               ------                           ------

Income before income taxes                                     12,558                            7,371
     Income tax expense                                         3,445                            2,024
                                                              -------                          -------
Net income                                                    $ 9,113                          $ 5,347
                                                              =======                          =======

Net income per common share
     Basic                                                    $  0.99                          $  0.59
                                                              -------                          -------
     Diluted                                                  $  0.97                          $  0.58
                                                              -------                          -------

                     Supplementary Financial Analysts' Data

Net written premiums                 $ 103,524                         $ 99,967
                                     ---------                         --------

Weighted average number of
   shares outstanding
     Basic                           9,239,878                        9,044,899
                                     ---------                        ---------
     Diluted                         9,377,614                        9,150,208
                                     ---------                        ---------

                           Consolidated Balance Sheet
                  (unaudited; in thousands, except share data)

                                                                                                  

                                                                  June 30, 2003                December 31, 2002
                                                                   -------------               ------------------

ASSETS
Investments:
         Fixed Maturities:
           Held to maturity, at amortized
cost                                                                 $ 106,781                      $ 86,702
           Available for sale, at fair value                           186,685                       194,732
           Equity securities, at fair value                             22,638                        21,836
           Short-term investments, at
                 cost, which approximates fair
                 value                                                  45,352                        29,029
                                                                        ------                        ------
                  Total investments                                    361,456                       332,299
Cash                                                                     2,326                         1,125
Premiums in course of collection                                        29,154                        26,287
Reinsurance receivable                                                  78,865                        83,207
Accrued investment income                                                3,598                         3,815
Deferred policy acquisition costs                                       15,521                        14,567
Prepaid reinsurance premiums                                            31,803                        27,854
Property and equipment, net                                              4,264                         4,430
Deferred income taxes                                                    6,511                         6,956
Other assets                                                             2,935                           678
                                                                     ---------                     ---------
                  Total assets                                       $ 536,433                     $ 501,218
                                                                     =========                     =========

LIABILITIES AND SHAREHOLDERS' EQUITY
Liabilities:
         Unpaid losses and loss
                 settlement expenses                                 $ 209,650                     $ 210,692
         Unearned premiums                                             132,113                       121,002
         Accounts payable and accrued expenses                           6,195                         6,584
         Debt                                                           12,800                        19,800
         Due to affiliates                                               4,441                         4,080
            Other liabilities                                           12,362                         5,877
         Subordinate Debt                                               15,000                             0
                                                                       -------                       -------
                  Total liabilities                                    392,561                       368,035

                                                                                                  

Shareholders' Equity
Preferred stock $1 par value;
authorized 2,000,000 shares,
none issued

            Class A common stock, $.01 par
            Value, Authorized 30,000,000
            shares, issued 6,369,829 and
            6,269,093 shares and
            outstanding 6,288,305 and                                       64                            63
            6,187,569 shares Class B common stock,
            $.01 par Value Authorized 10,000,000
            shares, issued 3,037,549 and                                    30                            30
            3,024,742 shares and outstanding
            2,996,787 and 2,983,980 shares
Additional paid-in capital                                              62,748                        60,652
Accumulated other comprehensive                                          6,322                         4,912
     income
Retained earnings                                                       75,600                        68,418
Treasury stock, at cost                                                  (892)                         (892)
                                                                     ---------                     ---------
Total stockholders' equity                                             143,872                       133,183
                                                                     ---------                     ---------
Total liabilities and shareholders' equity                           $ 536,433                     $ 501,218
                                                                     =========                     =========