REVOLVING NOTE

$7,500,000                                                Minneapolis, Minnesota
                                                                  March 20, 2002

         For value  received,  the  undersigned,  THE LEATHER  FACTORY,  INC., a
Delaware corporation,  ROBERTS, CUSHMAN & COMPANY, INC., a New York corporation,
THE LEATHER FACTORY,  INC., a Nevada corporation,  THE LEATHER FACTORY OF NEVADA
INVESTMENTS  INC.,  TANDY LEATHER  COMPANY,  INC., a Nevada  corporation,  TANDY
LEATHER COMPANY  INVESTMENTS,  INC., a Nevada corporation,  THE LEATHER FACTORY,
L.P., a Texas limited partnership,  TANDY LEATHER COMPANY, L.P., a Texas limited
partnership,  HI-LINE LEATHER & MANUFACTURING COMPANY, a California corporation,
THE LEATHER FACTORY, INC., an Arizona corporation (collectively, the "Borrowers"
and each a "Borrower"),  hereby promise to pay on the Termination Date under the
Credit Agreement  (defined  below),  to the order of WELLS FARGO BANK MINNESOTA,
NATIONAL ASSOCIATION, a Minnesota corporation (the "Lender"), at its main office
in Minneapolis,  Minnesota,  or at any other place designated at any time by the
holder  hereof,  in  lawful  money  of  the  United  States  of  America  and in
immediately  available  funds,  the  principal sum of Seven Million Five Hundred
Thousand  Dollars and No Cents  ($7,500,000)  or, if less, the aggregate  unpaid
principal  amount of all  Revolving  Advances made by the Lender to any Borrower
under the  Credit  Agreement  (defined  below)  together  with  interest  on the
principal amount hereunder  remaining unpaid from time to time,  computed on the
basis of the actual  number of days  elapsed and a 360-day  year,  from the date
hereof  until  this  Note is fully  paid at the rate from time to time in effect
under the  Amended  and  Restated  Credit and  Security  Agreement  of even date
herewith (the "Credit  Agreement")  by and between the Lender and the Borrowers.
The principal  hereof and interest  accruing thereon shall be due and payable as
provided in the Credit  Agreement.  This Note may be prepaid only in  accordance
with the Credit Agreement.

         This Note is issued pursuant,  and is subject, to the Credit Agreement,
which provides,  among other things, for acceleration  hereof.  This Note is the
Revolving  Note  referred  to in the  Credit  Agreement.  This Note is issued in
substitution  for and  replacement  of, but not in payment of, the Old Revolving
Note (as defined in the Credit  Agreement).  This Note is  secured,  among other
things,  pursuant to the Credit Agreement and the Security  Documents as therein
defined,  and may now or  hereafter  be secured  by one or more  other  security
agreements,  mortgages,  deeds of trust,  assignments  or other  instruments  or
agreements.

         The Borrowers shall pay all costs of collection,  including  attorneys'
fees and legal expenses if this Note is not paid when due,  whether or not legal
proceedings are commenced.





         Presentment or other demand for payment, notice of dishonor and protest
are expressly waived.

THE LEATHER FACTORY, L.P.,                      THE  LEATHER  FACTORY,  INC.,  a
a Texas limited partnership                     Delaware  corporation;  ROBERTS,
                                                CUSHMAN & COMPANY,  INC.,  a New
By  THE LEATHER FACTORY, INC.,                  York  corporation;  THE  LEATHER
    a Nevada corporation                        FACTORY,    INC.,    a    Nevada
    Its General Partner                         corporation; THE LEATHER FACTORY
                                                OF NEVADA  INVESTMENTS  INC.,  a
    By /s/ Wray Thompson                        Nevada    corporation;     TANDY
      ------------------                        LEATHER COMPANY,  INC., a Nevada
 Wray Thompson                                  corporation;    TANDY    LEATHER
 Its Chief Executive Officer                    COMPANY  INVESTMENTS,   INC.,  a
                                                Nevada   corporation;    HI-LINE
TANDY LEATHER COMPANY, L.P.,                    LEATHER & MANUFACTURING COMPANY,
a Texas limited partnership                     a  California  corporation;  and
                                                THE LEATHER  FACTORY,  INC.,  an
                                                Arizona corporation
By TANDY LEATHER COMPANY, INC.,
    a Nevada corporation
    Its General Partner                         By /s/ Wray Thompson
                                                  --------------------
                                                  Wray Thompson
    By /s/ Wray Thompson                          Its Chief Executive Officer
      ------------------
      Wray Thompson
      Its Chief Executive Officer