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       March 31, 2001
                               --------------------

 (   )   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
                       ----------------------

                      Dallas Gold and Silver Exchange, 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 May 11, 2001
----------------------------        ---------------------------
Common Stock, $.01 per value                 4,928,990


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<TABLE>
<CAPTION>

PART I.   FINANCIAL INFORMATION

Dallas Gold and Silver Exchange, Inc. and Subsidiaries
CONSOLIDATED BALANCE SHEETS
(Unaudited)



ASSETS
                                                                    March 31, 2001     December 31, 2000
                                                                  -----------------    -----------------
<S>                                                               <C>                  <C>
CURRENT ASSETS
    Cash and cash equivalents                                     $         274,666    $       1,362,219
    Trade receivables                                                       631,787              935,002
    Inventories                                                           6,814,340            7,087,265
    Prepaid expenses                                                        139,311              142,291
                                                                  -----------------    -----------------
                 Total current assets                                     7,860,104            9,526,777

MARKETABLE SECURITIES - AVAILABLE FOR SALE                                  857,972              856,081

PROPERTY AND EQUIPMENT - AT COST, NET                                     1,403,780            1,391,618

DEFERRED TAX ASSET                                                          323,881              171,432

GOODWILL, NET OF ACCUMULATED AMORTIZATION                                 1,295,459            1,343,804

OTHER ASSETS                                                                176,454              123,531
                                                                  -----------------    -----------------

                                                                  $      11,917,650    $      13,413,243
                                                                  =================    =================


LIABILITIES AND SHAREHOLDERS' EQUITY
CURRENT LIABILITIES
    Notes payable                                                 $       3,105,400    $       2,899,918
    Current maturities of long-term debt                                    800,227              830,561
    Accounts payable - trade                                              1,201,067            2,176,834
    Accrued expenses                                                        273,348              780,730
    Customer deposits                                                       190,417              127,144
    Federal income taxes payable                                            657,451              656,604

                 Total current liabilities                                6,227,910            7,471,791

LONG-TERM DEBT, less current maturities                                     923,827              949,838
SHAREHOLDERS' EQUITY
    Common stock, $.01 par value; authorized 10,000,000
       shares; issued and outstanding 4,927,990 shares at                    49,280               49,080
       March 31, 2001 and 4,907,990 shares at December 31, 2000
    Additional paid-in capital                                            5,739,244            5,609,445
    Accumulated other comprehensive loss                                   (703,780)            (690,749)
    Retained earnings(deficit)                                             (318,831)              23,838
                                                                  -----------------    -----------------
                          Total shareholders' equity                      4,765,913            4,991,614

                                                                  $      11,917,650    $      13,413,243
                                                                  =================    =================

</TABLE>

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<TABLE>
<CAPTION>

Dallas Gold and Silver Exchange, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF OPERATIONS
(Unaudited)


                                                          March 31, 2001    March 31, 2000
                                                          --------------    --------------
<S>                                                       <C>               <C>
Revenue
    Sales                                                 $    4,343,831    $    5,575,601
    Pawn services charges                                         27,015            19,760
    Gain (loss) on marketable securities - trading                  --             269,363
    Other Income                                                   2,517             2,400
                                                          --------------    --------------
                                                               4,373,363         5,867,124

Costs and expenses
    Cost of goods sold                                         3,279,246         4,274,587
    Consulting service costs                                      12,862            28,463
    Selling, general and administrative expenses               1,367,970         1,216,595
    Depreciation and amortization                                100,155            65,021
    Interest expense                                             107,421           108,372
                                                          --------------    --------------
                                                               4,867,654         5,693,038
                                                          --------------    --------------

                      Income (loss) before income taxes         (494,291)          174,086

Income tax expense (benefit)                                    (151,622)           60,000
                                                          --------------    --------------


                      Net income (loss)                   $     (342,669)   $      114,086
                                                          ==============    ==============

Earnings per common share
     Basic                                                ($         .07)   $          .03
     Diluted                                              ($         .07)   $          .02

Weighted average number of common shares
     Basic                                                     4,919,546         4,405,614
     Diluted                                                   5,159,818         4,768,446

</TABLE>


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<TABLE>
<CAPTION>

Dallas Gold and Silver Exchange, Inc. and Subsidiaries
CONSOLIDATED STATEMENTS OF CASH FLOWS
(Unaudited)


                                                                             Three Months Ended
                                                                                 March 31,
                                                                            2001           2000
                                                                        -----------    -----------
<S>                                                                     <C>            <C>
Reconciliation of net income to net cash provided by
   (used in) operating activities
        Net income (loss)                                               $  (342,669)   $   114,086
        Common stock issued for services                                       --           10,250
        Depreciation and amortization                                       100,155         65,021
        Unrealized loss on marketable securities -                             --          616,392
        Deferred taxes                                                     (151,622)       (24,074)
          (Increase) decrease in operating assets and liabilities
             Net change in marketable securities                               --        1,150,856
             Trade receivables                                              303,215        134,663
             Inventories                                                    272,925        235,871
             Prepaid expenses and other current assets                      (49,943)       (35,175)
             Accounts payable and accrued expenses                       (1,483,149)      (658,680)
             Customer deposits                                               63,273          2,477
             Federal income taxes payable                                      --         (111,540)
                                                                        -----------    -----------
               Total net cash provided (used in) operating activities    (1,287,815)     1,500,147

Cash flows from investing activities
             Purchase of marketable securities                              (14,901)          --
             Purchase of Fairchild International, Inc.                         --         (230,000)
             Purchase of property and equipment                             (63,972)      (150,690)
                                                                        -----------    -----------
               Net cash used in investing activities                        (78,873)      (380,690)

Cash flows from financing activities
             Change in indebtness - net                                     279,135     (1,357,474)
             Purchase  and retirement of common stock                          --          (79,934)
             Purchase of common treasury stock                                 --         (108,172)
                                                                        -----------    -----------
               Net cash used in financing activities                        279,135     (1,545,585)
                                                                        -----------    -----------


Net decrease in cash and cash equivalents                                (1,087,553)      (426,128)

Cash and cash equivalents at beginning of year                            1,362,219      1,263,716
                                                                        -----------    -----------

Cash and cash equivalents at end of period                              $   274,666    $   837,588
                                                                        ===========    ===========

</TABLE>

Supplemental schedule of noncash, investing and financing activities:

During  the  quarter  ended  March 31,  2001  debt  amounting  to $ 130,000  was
converted into common stock.


                                        4

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<TABLE>
<CAPTION>

(1)  Basis of Presentation:

         The accompanying  unaudited condensed consolidated financial statements
         of Dallas Gold and Silver Exchange,  Inc. and Subsidiaries  include the
         financial  statements of Dallas Gold and Silver Exchange,  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 period ended March
         31, 2000,  are not  necessarily  indicative  of the results that may be
         expected for the year ended December 31, 2000. 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, 1999.

(2)  - Earnings per share

     A reconciliation  of the income and shares of the basic earnings per common
     share and diluted  earnings per common share for the period ended March 31.
     2000 is as follows:

                                                                       Per-share
                                                   Income     Shares    amount
                                                 ---------  ---------  ---------
 Basic earnings per common share
    Income from operations allocable to
       common stockholders                       $ 114,086  4,405,614    $.03
                                                                         ====

 Effect of dilutive securities
  Stock options and warrants                          --      154,499
  Convertible debt                                   3,877    208,333
                                                            ---------    ----
 Diluted earnings per common share
    Income from operations available to common
         stockholders plus assumed conversions   $ 117,963  4,768,446    $.02
                                                 =========  =========    ====


No  reconciliation  is provided  for the period ended March 31, 2001 because the
effect is not dilutive.

(3)  - Business segment information

     The Company's operations by business segment were as follows:

                                                                                                 Consulting       Corporate
                                  Software      Liquidations       Jewelry        Services         & other      Consolidated
                                ------------    ------------    ------------    ------------    ------------    ------------
<S>                             <C>             <C>             <C>             <C>             <C>             <C>
      Revenues
        2001                    $      3,577    $    535,072    $  3,834,333    $        381            --      $  4,373,363
        2000                    $     46,595    $  1,296,330    $  4,252,470    $    271,729            --      $  5,867,124

      Operating income (loss)
        2001                    $    (30,867)   $   (406,248)   $    (35,898)   $    (16,581)   $     (4,697)   $   (494,291)
        2000                    $     16,063    $   (148,849)   $    104,379    $    236,256    $    (33,763)   $    174,086

      Identifiable assets
        2001                    $    119,582    $  4,528,747    $  6,187,051    $    930,648    $       --      $ 11,766,028
        2000                    $     90,319    $  3,865,731    $  5,058,470    $  2,029,681    $       --      $ 11,044,201

      Capital expenditures
        2001                    $       --      $       --      $     63,972    $       --      $       --      $     63,972
        2000                    $      6,000    $       --      $    144,690    $       --      $       --      $    150,690
      Depreciation and
        amortization
        2001                    $      5,105    $     35,711    $     55,239    $      4,100    $       --      $    100,155
        2000                    $        969    $     36,012    $     23,633    $      4,407    $       --      $     65,021

</TABLE>

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<TABLE>
<CAPTION>

(4) Other Comprehensive income:

Other comprehensive income is as follows:

                                                                   Tax
                                                 Before Tax     (Expense)     Net-of-Tax
                                                   Amount        Benefit        Amount
                                                -----------    -----------   -----------
<S>                                             <C>            <C>           <C>
Other comprehensive income (loss) at
   December 31, 2000                            $(1,052,207)   $   361,458   $  (690,749)

Unrealized holding losses arising during 2001       (19,744)         6,713       (13,031)
                                                -----------    -----------   -----------

Other comprehensive income (loss) at
   March 31, 2001                               $(1,071,951)   $   368,171   $  (703,780)
                                                ===========    ===========   ===========

</TABLE>

MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

Results of Operations
---------------------
Quarter ended March 31, 2001 vs 2000:

Sales for the first quarter of 2001 decreased  $1,231,770 or 22.1% when compared
to the  corresponding  quarter of 2000.  This was the  primarily the result of a
decrease  in sales in the  jewelry  segment  in the  amount  of  $418,137  and a
decrease  in sales  from the  liquidation  segment  in the  amount of  $761,258.
Jewelry  segment  revenues  were lower due a continued  softness in the precious
metals market with  precious  metal sales  decreasing  by $727,381.  Liquidation
sales were lower due to no significant new liquidation sales being booked during
the first two months of the quarter.  Gain on marketable securities - trading in
the amount of $269,363  during 2000 was the result of  realized  and  unrealized
gains on trading  securities.  Cost of sales decreased by $995,341 primarily due
to the decrease in sales.

General and  administration  expenses increased by $151,375 primarily due to the
acquisition  of the  business of  Fairchild  International,  Inc. in March 2000.
Depreciation and amortization  expense  increased by $35,134 due to depreciation
and amortization on assets and goodwill acquired in the Fairchild acquisition.

Income tax (benefit)  and expense are provided at the corporate  rate of 34% for
both 2001 and 2000, net of non-deductible goodwill amortization expense in 2001.

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

Management of the Company  expects capital  expenditures to total  approximately
$75,000  during the balance of 2001. It is anticipated  that these  expenditures
will be funded from the Company's current working capital position.

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 by
the  Company,  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 unforseen working capital requirement.


                                       6

<PAGE>

PART II.   OTHER INFORMATION
----------------------------


ITEM 6.  EXHIBITS AND REPORTS ON FORM 8-K

         Reports on Form 8-K - None


                                   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.


Dallas Gold and Silver Exchange, Inc.


By:      /s/ L. S. Smith                    Dated: May 14, 2001
         -------------------------
         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: May 14, 2001
         -------------------------
         L. S. Smith
         Chairman of the Board,
         Chief Executive Officer and
         Secretary


By:      /s/ W. H. Oyster                   Dated: May 14, 2001
         -------------------------
         W. H. Oyster
         Director, President and
         Chief Operating Officer


By:      /s/ John Benson                    Dated: May 14, 2001
         -------------------------
         John Benson
         Chief Financial Officer
         (Principal Accounting Officer)



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