SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549
                                   FORM 10-QSB

(Mark One)

 ( X )   Quarterly  Report  pursuant  to Section  13 or 15(d) of the  Securities
         Exchange Act of 1934

For the quarterly period ended    September 30, 2003
                               ------------------------

 (   )   Transition Report under Section 13 or 15(d) of the Securities  Exchange
         Act of 1934

For the transition period from                 to
                               ---------------    ---------------

Commission File Number              1-11048
                       --------------------------------------------

                              DGSE Companies, Inc.
                         (Name of small business issuer)


          Nevada                                           88-0097334
----------------------------                     -------------------------------
(State or other jurisdiction                     (I.R.S. Employer Identification
 of incorporation or organization)                Number)



     2817 Forest Lane, Dallas, Texas                                 75234
--------------------------------------------                    ----------------
(Address of principal executive offices)                           (Zip Code)

(Issuer's telephone number, including area code) (972) 484-3662
                                                 --------------


Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days. Yes X  No
                                      ---   ---

Indicate the number of shares  outstanding  of each of the  issuer's  classes of
common stock, as of the latest practicable date.

           Class                                 Outstanding at November 1, 2003
----------------------------                     -------------------------------
Common Stock, $.01 per value                               4,913,290




<PAGE>
<TABLE>
<CAPTION>

PART I.   FINANCIAL INFORMATION
          Item 1. Financial Statements

DGSE Companies, Inc. and Subsidiaries

CONSOLIDATED BALANCE SHEETS
                                                             (Unaudited)

ASSETS                                                      September 30,    December 31,
                                                                 2003             2002
                                                            -------------    -------------
<S>                                                         <C>              <C>
CURRENT ASSETS
    Cash and cash equivalents                               $      44,132    $     498,408
    Trade receivables                                             605,038          792,590
    Inventories                                                 7,067,665        6,335,742
    Prepaid expenses                                              244,618          152,854
                                                            -------------    -------------

              Total current assets                              7,961,453        7,779,594

MARKETABLE SECURITIES - AVAILABLE FOR SALE                        189,960          176,908

PROPERTY AND EQUIPMENT - AT COST, NET                           1,045,630        1,157,225

DEFERRED TAX ASSET                                                120,433

GOODWILL                                                        1,151,120        1,151,120

OTHER ASSETS                                                      163,682          160,109
                                                            -------------    -------------

                                                            $  10,511,845    $  10,545,389
                                                            =============    =============



LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
    Notes payable                                           $   3,227,737    $     689,641
    Current maturities of long-term debt                          265,814          174,245
    Accounts payable - trade                                      578,045          591,479
    Accrued expenses                                              152,797          677,104
    Customer deposits                                             234,393          106,314
    Federal income taxes payable                                  227,179          485,453
                                                            -------------    -------------

              Total current liabilities                         4,685,965        2,724,236

Long-term debt, less current maturities                           893,904        3,066,797
Deferred income taxes                                              38,889            2,827
                                                            -------------    -------------

              Total liabilities                                 5,618,758        5,793,860

SHAREHOLDERS' EQUITY
    Common stock, $.01 par value; authorized 10,000,000
       shares; issued and outstanding 4,913,290 shares at
       September 30, 2003 and December 31, 2002                    49,133           49,133
    Additional paid-in capital                                  5,708,760        5,708,760
    Accumulated other comprehensive loss                       (1,126,338)      (1,134,950)
   Accumulated earnings                                           261,532          128,586
                                                            -------------    -------------
              Total shareholders' equity                        4,893,087        4,751,529


                                                            $  10,511,845    $  10,545,389
                                                            =============    =============
</TABLE>

                                        2



<PAGE>

DGSE Companies, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
Three months ended September 30,
(Unaudited)



                                                         2003           2002
                                                     -----------    -----------

Revenue
    Sales                                            $ 5,526,812    $ 4,715,089
    Pawn service charges                                  46,846         37,143
                                                     -----------    -----------
                                                       5,573,658      4,752,232

Costs and expenses
    Cost of goods sold                                 4,313,270      3,596,429
    Consulting service costs                              13,438         10,417
    Selling, general and administrative expenses         996,015      1,038,975
    Depreciation and amortization                         43,080         53,532
                                                     -----------    -----------
                                                       5,365,803      4,699,353

Other income (expense)
   Interest expense                                      (64,210)       (97,839)
                                                     -----------    -----------

           Total other income (expense)                  (64,210)       (97,839)
                                                     -----------    -----------

        Income (loss) before income taxes                143,645        (44,960)

Income tax expense (benefit)                              48,839        (15,287)
                                                     -----------    -----------

        Net income (loss)                            $    94,806    $   (29,673)
                                                     ===========    ===========


Income (loss) per common share
    Basic and diluted                                $       .02    ($      .01)

    Weighted average number of common shares
    Basic                                              4,913,290      4,927,990
    Diluted                                            4,913,290      5,060,310











                                        3

<PAGE>

DGSE Companies, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
Nine months ended September 30,
(Unaudited)



                                                       2003            2002
                                                   ------------    ------------
Revenue
    Sales                                          $ 16,552,295    $ 14,587,430
    Pawn service charges                                130,358         117,003
                                                   ------------    ------------
                                                     16,682,653      14,704,433

Costs and expenses
    Cost of goods sold                               13,147,200      11,258,970
    Consulting service costs                             40,317          38,420
    Selling, general and administrative expenses      2,960,280       3,133,106
    Depreciation and amortization                       128,178         159,693
                                                   ------------    ------------
                                                     16,275,975      14,590,189
Other income (expense)
   Interest expense                                    (205,245)       (291,375)
   Other Income                                            --              --
                                                   ------------    ------------

         Total other income (expense)                  (205,245)       (291,375)

         Income (loss) before income taxes              201,433        (177,131)

Income tax expense (benefit)                             68,487         (60,225)
                                                   ------------    ------------

         Net income (loss)                         $    132,946    $   (116,906)
                                                   ============    ============


Income (loss) per common share
     Basic and diluted                             $        .03    ($       .02)

     Weighted average number of common shares
     Basic                                            4,913,290       4,925,206
     Diluted                                          4,913,290       5,098,638










                                        4

<PAGE>
<TABLE>
<CAPTION>

DGSE COMPANIES, Inc. and Subsidiaries

CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)


                                                                       Nine Months Ended
                                                                         September 30,
                                                                      2003           2002
                                                                  -----------    -----------
<S>                                                               <C>            <C>
Cash Flows From Operations
Reconciliation of net loss to net cash
    used in  operating activities
      Net income (loss)                                           $   132,946    $  (116,906)
      Common stock issued for services                                   --            1,074
      Depreciation and amortization                                   128,178        159,693
      Deferred taxes                                                  156,495        (60,225)
        (Increase) decrease in operating assets and liabilities
          Trade receivables                                           187,552         36,735
          Inventories                                                (731,923)      (135,859)
          Prepaid expenses and other current assets                   (91,764)       (15,566)
          Accounts payable and accrued expenses                      (537,741)      (789,301)
          Customer deposits                                           128,079        118,249
          Federal income taxes payable                               (258,274)          --
          Other                                                        (8,013)        (9,983)
                                                                  -----------    -----------
             Total net cash used in operating activities             (894,465)      (812,089)

Cash flows from investing activities
                 Purchase of marketable securities                       --             --
                 Purchase of property and equipment                   (16,583)       (30,731)
                                                                  -----------    -----------
                 Net cash used in investing activities                (16,583)       (30,731)

Cash flows from financing activities
                Proceeds from notes issued                            759,054        709,054
             Payments on notes payable                               (302,282)      (830,019)
                                                                  -----------    -----------
                 Net cash used in financing activities                456,772       (120,965)
                                                                  -----------    -----------

Net decrease in cash and cash equivalents                            (454,276)      (963,785)

Cash and cash equivalents at beginning of year                        498,408      1,063,060
                                                                  -----------    -----------

Cash and cash equivalents at end of period                        $    44,132    $    99,275
                                                                  ===========    ===========
</TABLE>

Supplemental schedule of non-cash, investing and financing activities:

Interest  paid for the  nine  months  ended  September  30,  2003 and 2002 was $
205,245 and $ 291,375, respectively.

During the nine months ended  September 30, 2003, $ 174,683 of income taxes were
paid. During the nine months ended September 30, 2002 no income taxes were paid.



                                        5
<PAGE>

(1)  Basis of Presentation:


The accompanying  unaudited condensed  consolidated financial statements of DGSE
Companies,  Inc.  and  Subsidiaries  include the  financial  statements  of DGSE
Companies,  Inc.  and  its  wholly-owned  subsidiaries,  DGSE  Corporation,  DLS
Financial   Services,   Inc.,   National  Jewelry  Exchange,   Inc.,   Silverman
Consultants,  Inc.,  Charleston Gold And Diamond  Exchange,  Inc. and eye media,
inc.  In the  opinion  of  management,  all  adjustments  (consisting  of normal
recurring  accruals)  considered  necessary  for a fair  presentation  have been
included.

The  Company's  operating  results  for the three  month and nine  months  ended
September 30, 2003,  are not  necessarily  indicative of the results that may be
expected for the year ended December 31, 2003. For further information, refer to
the  consolidated  financial  statements and footnotes  thereto  included in the
Company's annual report on Form 10-KSB for the year ended December 31, 2002.

 (2)  - Earnings per share

No  reconciliation is provided for the periods ended September 30, 2003 and 2002
because the effect is not dilutive.

(3)  - Business segment information

The Company's operations by business segment for the nine months ended September
30, were as follows:
<TABLE>
<CAPTION>

                                        Consulting &      Corporate
                            Jewelry     Liquidations      & other       Consolidated
                         ------------   ------------    ------------    ------------
<S>                      <C>            <C>             <C>             <C>
Revenues
   2003                  $ 16,351,696   $    330,957    $       --      $ 16,682,653
   2002                  $ 14,140,545   $    563,888    $       --      $ 14,704,433

Income (loss) before income taxes
   2003                  $    382,986   $   (103,642)   $    (77,911)   $    201,433
   2002                  $    268,375   $   (251,326)   $   (194,180)   $   (177,131)


Identifiable assets
   2003                  $  9,909,156   $    602,689    $       --      $ 10,511,845
   2002                  $  9,236,525   $  1,097,904    $       --      $ 10,334,429

Capital expenditures
   2003                  $     16,583   $       --      $       --      $     16,583
   2002                  $     30,731   $       --      $       --      $     30,731

Depreciation and
amortization
   2003                  $    122,553   $      5,625    $       --      $    128,178
   2002                  $    132,367   $     27,326    $       --      $    159,693



The  Company's  operations  by  business  segment  for the  three  months  ended
September 30, were as follows:

                                        Consulting &      Corporate
                            Jewelry     Liquidations      & other       Consolidated
                         ------------   ------------    ------------    ------------
Revenues
   2003                  $  5,497,125   $     76,533    $       --      $  5,573,658
   2002                  $  4,587,574   $    164,658    $       --      $  4,752,232

Income (loss) before income taxes
   2003                  $    224,719   $    (56,650)   $    (24,424)   $    143,645
   2002                  $     95,995   $    (28,937)   $   (112,018)   $    (44,960)

Identifiable assets
   2003                  $  9,909,156   $    602,689    $       --      $ 10,511,845
   2002                  $  9,236,525   $  1,097,904    $       --      $ 10,334.429


<PAGE>

Capital expenditures
   2003                  $      6,483   $       --      $       --      $      6,483
   2002                  $      2,464   $       --      $       --      $      2,464

Depreciation and
amortization
   2003                  $     41,205   $      1,875    $       --      $     43,080
   2002                  $     35,458   $       --      $       --      $     53,532
</TABLE>



(4) Other Comprehensive income:

Other comprehensive income is as follows:
<TABLE>
<CAPTION>
                                                                  Tax
                                               Before Tax      (Expense)     Net-of-Tax
                                                  Amount        Benefit        Amount
                                               -----------    -----------    -----------
<S>                                            <C>            <C>            <C>
Other comprehensive income loss at
   December 31, 2002                           $(1,728,130)   $   593,180    $(1,134,950)
Unrealized holding gains arising during the
    Three months ended March 31, 2003               75,278        (25,594)        49,684
                                               -----------    -----------    -----------
Other comprehensive income (loss) at
   March 31, 2003                               (1,652,852)       567,586     (1,085,266)
Unrealized holding gains arising during the
   Three months ended June 30, 2003                (46,260)        15,728        (30,532)
                                               -----------    -----------    -----------
Other comprehensive income (loss) at
   June 30, 2003                               $(1,699,112)   $   583,314    $(1,115,798)
Unrealized holding (loss) arising during the
   Three months ended September 30, 2003           (15,970)         5,430        (10,540)
                                               -----------    -----------    -----------
Other comprehensive income (loss) at
  September 30, 2003                           $(1,715,082)   $   588,744    $(1,126,338)
</TABLE>


(5) Stock-based Compensation:

The  Company  accounts  for  stock-based  compensation  to  employees  using the
intrinsic  value  method.  Accordingly,  compensation  cost for stock options to
employees is measured as the excess,  if any , of the quoted market price of the
Company's common stock at the date of the grant over the amount an employee must
pay to acquire the stock.

The following table  illustrates the effect on net income and earnings per share
if the  Company  had  applied  the fair  value  recognition  provisions  of FASB
Statement No. 123,  Accounting  for  Stock-Based  Compensation,  to  stock-based
employee compensation.
<TABLE>
<CAPTION>

                                                   Nine Months Ended September 30,

                                                   -------------------------------
                                                           2003            2002
                                                   ---------------   -------------
<S>                                                <C>               <C>
Net profit (loss), as reported                     $       132,946   $    (116,906)
Deduct:  Total stock-based employee compensation
Expense determined under fair value based method
For all awards, net of related tax effects                    --            (2,025)

                                                   ---------------   -------------
Pro forma net profit (loss)                        $       132,946   $    (118,931)
                                                   ===============   =============


<PAGE>

Earnings per share:
     Basic - as reported                                       .03            (.02)
     Basic - pro forma                                         .03            (.02)
     Diluted - as reported                                     .03            (.02)
     Diluted pro forma                                         .03            (.02)
</TABLE>

The fair value of these  options  was  estimated  at the date of grant using the
Black-Scholes   option-pricing   model  with  the  following   weighted  average
assumptions  used for grants  after  1998,  expected  volatility  of 70% to 96%,
risk-free  rate of 3.9% to 6.6%,  no dividend  yield and expected life of 5 to 8
years.

Item 2.
MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Results of Operations

Quarter ended September 30, 2003 vs 2002:
-----------------------------------------

Revenues  for the third  quarter  of 2003  increased  by $ 821,426 or 17.3% when
compared to the  corresponding  period of 2002.  This increase was primarily the
result  of a $ 909,551  increase  in sales  from the  jewelry  segment.  Jewelry
segment revenues were higher due to an improvement in the precious metals market
with precious  metal sales  increasing by $ 332,151 and, an  improvement  in the
retail  environment.  Cost of sales  increased  primarily due to the increase in
sales.  Gross  margins  declined  from 23.7% in 2002 to 21.9% in 2003 due to the
increase in sales of precious metals which have a lower margin than jewelry.

Selling,  general and  administration  expenses  decreased by $ 42,960 due staff
reductions.  Depreciation and amortization  expense decreased by $ 10,452 due to
certain assets becoming fully depreciated during late 2002.

Interest expense decreased by $ 33,629 due the re-financing of $ 2,700,000 of
the Company's bank debt in November 2002.

Income taxes are provided at the corporate rate of 34% for both 2003 and 2002

Nine months ended September 30, 2003 vs 2002:
---------------------------------------------

Revenues  for the first nine months of 2003  increased  by $ 1,978,220  or 13.5%
when compared to the corresponding period of 2002. This was primarily the result
of an  increase in sales in the  jewelry  segment in the amount of $  2,211,151.
Jewelry  segment  revenues  were higher due to an  improvement  in the  precious
metals  market with  precious  metal  sales  increasing  by $ 1,577,766  and, an
improvement in the retail environment.  Cost of sales increased primarily due to
the increase in sales.  Gross  margins  declined  from 22.8% in 2002 to 20.6% in
2003 due to the  increase in sales of precious  metals which have a lower margin
than jewelry.

Selling,  general and  administration  expenses decreased by $ 172,826 due staff
reductions.  Depreciation and amortization  expense decreased by $ 31,515 due to
certain assets becoming fully depreciated during late 2002.

Interest  expense  decreased by $ 86,130 due the  re-financing of $ 2,700,000 of
the Company's bank debt in November 2002.

Income taxes are provided at the corporate rate of 34% for both 2003 and 2002

<PAGE>

Liquidity and Capital Resources
-------------------------------

The Company's  short-term debt,  including current  maturities of long-term debt
totaled  $3,457,050  as of  September  30,  2003.  The ability of the Company to
finance its operations and working capital needs are dependent upon management's
ability to  negotiate  extended  terms or refinance  its  short-term  debt.  The
Company has  historically  renewed,  extended or replaced  short-term debt as it
matures and  management  believes that it will be able to do so in the future as
short-term debt matures.

Management of the Company  expects capital  expenditures to total  approximately
$15,000  during the balance of 2003. It is anticipated  that these  expenditures
will be funded from working capital.

From time to time,  management  has adjusted the Company's  inventory  levels to
meet  seasonal  demand  or  in  order  to  meet  working  capital  requirements.
Management  is of the opinion that if  additional  working  capital is required,
additional loans can be obtained from  individuals or from commercial  banks. If
necessary,  inventory  levels  may be  adjusted  or a portion  of the  Company's
investments in marketable  securities may be liquidated in order to meet working
capital requirements.
<TABLE>
<CAPTION>

Contractual Cash Obligations                                         Payments due by year end
----------------------------                     --------------------------------------------------------------
                                       Total        2003         2004         2005         2006         2007      Thereafter
                                    ----------   ----------   ----------   ----------   ----------   ----------   ----------
<S>                                 <C>          <C>          <C>          <C>          <C>          <C>          <C>
Notes  payable                      $3,227,737   $  352,737   $2,875,000         --           --           --           --
Long-term debt and capital leases    1,159,718       43,444      295,775   $  387,602   $   43,077   $   43,531   $  346,829
Federal income taxes                   224,194      224,194         --           --           --           --           --
Operating leases                       554,426       81,906      294,093      148,205       18,886       11,336         --
                                    ----------   ----------   ----------   ----------   ----------   ----------   ----------
                                    $5,166,075   $  701,471   $3,464,868   $  535,807   $   61,963   $   54,867   $  346,829
                                    ==========   ==========   ==========   ==========   ==========   ==========   ==========
</TABLE>


This  report  contains  forward-looking  statements  which  reflect  the view of
Company's management with respect to future events. Although management believes
that  the  expectations   reflected  in  such  forward-looking   statements  are
reasonable,  it can give no assurance that such  expectations will prove to have
been  correct.  Important  factors  that could  cause  actual  results to differ
materially from such  expectations  are a down turn in the current strong retail
climate and the  potential  for  fluctuations  in precious  metals  prices.  The
forward-looking  statements  contained  herein  reflect the current views of the
Company's  management  and the  Company  assumes  no  obligation  to update  the
forward-looking  statements or to update the reasons actual results could differ
from those contemplated by such forward-looking statements.


ITEM 3. Controls and Procedures

Under the supervision and with the  participation  of our management,  including
our  principal  executive  officer  and  principal  financial  officer,  we have
evaluated  the  effectiveness  of the design  and  operation  of our  disclosure
controls  and  procedures  within 90 days of the filing  date of this  quarterly
report,  and, based on their  evaluation,  our principal  executive  officer and
principal  financial  officer have  concluded that these controls and procedures
are  effective.  There are no  significant  changes in our internal  controls or
other factors that could  significantly  affect these controls subsequent to the
date of their  evaluation.  Disclosure  controls and procedures are our controls
and other procedures that are designed to ensure that information required to be
disclosed  by us in the reports that we file or submit under the Exchange Act is
recorded,  processed,  summarized and reported, within the time period specified
in the Securities and Exchange Commission's rules and forms. Disclosure controls
and procedures include, without limitation,  controls and procedures designed to
ensure that  information  required to be  disclosed by us in the reports that we
file under the Exchange Act is accumulated  and  communicated to our management,
including our principal  executive officer and principal  financial officer,  as
appropriate to allow timely decisions regarding required disclosure.


<PAGE>

PART II.   OTHER INFORMATION

ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         Exhibit  - 31.1   Certificate  of  pursuant  to  Section  3026  of  the
                           Sarbanes-Oxley Act of 2002, Chief Executive Officer.

         Exhibit  - 31.2   Certificate   of  pursuant  to  Section  302  of  the
                           Sarbanes-Oxley Act of 2002, Chief Financial Officer.

         Exhibit  - 32.1   Certificate   of  pursuant  to  Section  906  of  the
                           Sarbanes-Oxley Act of 2002, Chief Executive Officer.

         Exhibit  - 32.2   Certificate   of  pursuant  to  Section  906  of  the
                           Sarbanes-Oxley Act of 2002, Chief Financial Officer.


         Reports on Form 8-K - None






<PAGE>

                                   SIGNATURES


         In  accordance  with  Section  13 and 15(d) of the  Exchange  Act,  the
Registrant  caused  this  report to be signed on its behalf by the  undersigned,
thereunto duly authorized.

DGSE Companies, Inc.



By:      /s/ L. S. Smith                    Dated: November 1, 2003
         -------------------------
         L. S. Smith
         Chairman of the Board,
         Chief Executive Officer and
         Secretary

         In accordance  with the Exchange Act, this report has been signed below
by the following  persons on behalf of the  Registrant and in the capacities and
on the date indicated.


By:      /s/ L. S. Smith                    Dated: November 1, 2003
         -------------------------
         L. S. Smith
         Chairman of the Board,
         Chief Executive Officer and
         Secretary


By:      /s/ W. H. Oyster                   Dated: November 1, 2003
         -------------------------
         W. H. Oyster
         Director, President and
         Chief Operating Officer


By:      /s/ John Benson                    Dated: November 1, 2003
         -------------------------
         John Benson
         Chief Financial Officer
         (Principal Accounting Officer)