FORM 4 Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).

UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940

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1. Name and Address of Reporting Person * Knight Craig A   2. Issuer Name and Ticker or Trading Symbol Forestar Group Inc. [FOR] 5. Relationship of Reporting Person(s) to Issuer (Check all applicable) _____ Director _____ 10% Owner __X__ Officer (give title below) _____ Other (specify below) Chief Real Estate Officer (Last) (First) (Middle) 6300 BEE CAVE ROAD, BUILDING TWO, SUITE 500 3. Date of Earliest Transaction (Month/Day/Year) 02/09/2010 (Street) AUSTIN, TX 78746 4. If Amendment, Date Original Filed(Month/Day/Year) 6. Individual or Joint/Group Filing(Check Applicable Line) _X_ Form filed by One Reporting Person ___ Form filed by More than One Reporting Person (City) (State) (Zip) Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned

1.Title of Security (Instr. 3) 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code (Instr. 8) 4. Securities Acquired (A) or Disposed of (D) (Instr. 3, 4 and 5) 5. Amount of Securities Beneficially Owned Following Reported Transaction(s) (Instr. 3 and 4) 6. Ownership Form: Direct (D) or Indirect (I) (Instr. 4) 7. Nature of Indirect Beneficial Ownership (Instr. 4) Code V Amount (A) or (D) Price Common Stock 02/09/2010   M   4,333 (1) A (1) 50,524 D   Common Stock 02/09/2010   D   4,333 (1) D (1) 46,191 D   Common Stock 02/09/2010   A   7,753 (2) A $ 0 53,944 D   Common Stock 02/09/2010   A   22,472 (3) A $ 0 76,416 (4) D

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)

1. Title of Derivative Security (Instr. 3)

2. Conversion or Exercise Price of Derivative Security

3. Transaction Date (Month/Day/Year)

3A. Deemed Execution Date, if any (Month/Day/Year)

4. Transaction Code (Instr. 8)

5. Number of Derivative Securities Acquired (A) or Disposed of (D) (Instr. 3, 4, and 5)

6. Date Exercisable and Expiration Date (Month/Day/Year)

7. Title and Amount of Underlying Securities (Instr. 3 and 4)

8. Price of Derivative Security (Instr. 5)

9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s) (Instr. 4)

10. Ownership Form of Derivative Security: Direct (D) or Indirect (I) (Instr. 4)

11. Nature of Indirect Beneficial Ownership (Instr. 4)

Code

V

(A)

(D)

Date Exercisable

Expiration Date

Title

Amount or Number of Shares

Option (right to buy) (5) (6)

$ 11.76

02/02/2002

02/02/2011

Common Stock

833

833

D

Option (right to buy) (6) (7)

$ 13.26

02/01/2003

02/01/2012

Common Stock

1,666

1,666

D

Option (right to buy) (6) (8)

$ 8.68

02/07/2004

02/07/2013

Common Stock

2,500

2,500

D

Option (right to buy) (6) (9)

$ 15.02

02/06/2005

02/06/2014

Common Stock

1,666

1,666

D

Option (right to buy) (6) (10)

$ 20.26

02/04/2006

02/04/2015

Common Stock

1,666

1,666

D

Option (right to buy) (6) (11)

$ 27.06

02/03/2007

02/03/2016

Common Stock

3,333

3,333

D

Option (right to buy) (6) (12)

$ 30.56

02/02/2008

02/02/2017

Common Stock

3,333

3,333

D

Option (right to buy) (13)

$ 28.85

02/12/2009

02/12/2018

Common Stock

66,500

66,500

D

Option (right to buy) (14)

$ 9.29

02/10/2010

02/10/2019

Common Stock

35,406

35,406

D

Option (right to buy) (15)

$ 17.8

02/09/2010

A

15,367

02/09/2011

02/09/2020

Common Stock

15,367

$ 0

15,367

D

Stock Appreciation Right (16)

$ 9.29

02/10/2010

02/10/2019

Common Stock

78,807

78,807

D

Stock Appreciation Right (17)

$ 17.8

02/09/2010

A

18,040

02/09/2011

02/09/2020

Common Stock

18,040

$ 0

18,040

D

Restricted Share Units (1) (6) (18)

(18)

02/09/2010

M

4,333

(18)

(18)

Common Stock

4,333

$ 0

0

D

Restricted Share Units (19)

(19)

(19)

(19)

Common Stock

24,220

24,220

D

Restricted Share Units (20)

(20)

02/09/2010

A

9,101

(20)

(20)

Common Stock

9,101

$ 0

9,101

D

Reporting Owners

Reporting Owner Name / Address	Relationships
	Director	10% Owner	Officer	Other
Knight Craig A 6300 BEE CAVE ROAD BUILDING TWO, SUITE 500 AUSTIN, TX 78746			Chief Real Estate Officer

Signatures

David M. Grimm signing on behalf of Craig A. Knight		02/11/2010
**Signature of Reporting Person		Date

Explanation of Responses:

*	If the form is filed by more than one reporting person, see Instruction 4(b)(v).
**	Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1)	Performance share units vested 2/2/2010. Conditions of payment satisfied 2/9/2010. Performance share units are being settled for cash based on the fair market value on 2/2/2010.
(2)	Restricted shares granted on 2/9/2010 will vest effective 2/9/2013. Restricted shares are subject to a 1% ROA performance criteria.
(3)	Restricted shares granted on 2/9/2010 will vest as follows: 7,491 effective 2/9/2011; 7,490 effective 2/9/2012; 7,491 effective 2/9/2013.
(4)	In accordance with the Rights Agreement adopted by the Company on December 11, 2007, Preferred Stock Purchase Rights are deemed to be attached to the shares of Common Stock.
(5)	Options Vesting Schedule - Exercise price is $11.76: Options Exercisable 02/02/2004- 833.
(6)	Shares acquired in a pro rata distribution by Temple-Inland Inc. through a spin-off on or around December 28, 2007.
(7)	Options Vesting Schedule - Exercise price is $13.26: Options Exerciserable 02/01/2005- 1,666.
(8)	Options Vesting Schedule - Exercise price is $8.68: Options Exercisable 02/07/2007 - 2,500.
(9)	Options Vesting Schedule - Exercise price of $15.02: Options Exercisable 02/06/2007 - 1,250; Options Exercisable 02/06/2008 - 416.
(10)	Options Vesting Schedule - Exercise price of $20.26: Options Exercisable 02/04/2007 - 833; Options Exercisable 02/04/2008 - 416; Options Exercisable 02/04/2009 - 416.
(11)	Options Vesting Schedule - Exercise price of $27.06: Options Exercisable 02/03/2007 - 833; Options Exercisable 02/03/2008 - 833; Options Exercisable 02/03/2009 - 833; and Options Exercisable 02/03/2010 - 833.
(12)	Options Vesting Schedule - Exercise price of $30.56: Options Exercisable 02/02/2008 - 833; Options Exercisable 02/02/2009 - 833; Options Exercisable 02/02/2010 - 833; and Options Exercisable 02/02/2011 - 833.
(13)	Options Vesting Schedule for Options Granted 02/12/2008 - Exercise price is $28.85: Options Exercisable 02/12/2009 - 16,625; Options Exercisable 02/12/2010 - 16,625; Options Exercisable 02/12/2011 - 16,625; Options Exercisable 02/12/2012 - 16,625.
(14)	Vesting schedule for Options granted 02/10/2009 - Exercise price is $9.29: Options Exercisable 02/10/2010 - 8,851; Options Exercisable 02/10/2011 - 8,851; Options Exercisable 02/10/2012 - 8,852; and Options Exercisable 02/10/2013 - 8,852.
(15)	Vesting schedule for Options granted 02/9/2010 - Exercise price is $17.80: Options Exercisable 02/9/2011 - 3,841; Options Exercisable 02/9/2012 - 3,842; Options Exercisable 02/9/2013 - 3,842; and Options Exercisable 02/9/2014 - 3,842.
(16)	Vesting schedule for Stock Appreciation Rights (SARs) granted 02/10/2009 - Exercise price is $9.29: SARs Exercisable 02/10/2010 - 19,701; SARs Exercisable 02/10/2011 - 19,702; SARs Exercisable 02/10/2012 - 19,702; and SARs Exercisable 02/10/2013 - 19,702.
(17)	Vesting schedule for Stock Appreciation Rights (SARs) granted 02/9/2010 - Exercise price is $17.80: SARs Exercisable 02/9/2011 - 4,510; SARs Exercisable 02/9/2012 - 4,510; SARs Exercisable 02/9/2013 - 4,510; and SARs Exercisable 02/9/2014 - 4,510. SARs will be settled for cash.
(18)	Restricted share units will vest effective 02/02/2010. Restricted share units will be settled for cash based on the fair market value on the vesting date.
(19)	Restricted share units granted on 2/10/2009 will vest effective 2/10/2012. Restricted share units will be settled for cash based on the fair market value on the vesting date subject to a 1% ROA performance criteria.
(20)	Restricted share units granted on 2/9/2010 will vest effective 2/9/2013. Restricted share units will be settled for cash based on the fair market value on vesting date subject to a 1% ROA performance criteria.

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