**UNITED      STATES SECURITIES AND EXCHANGE COMMISSION**

**Washington,      D.C. 20549**

**Form 10-Q**

|   |   |                                                                                                                                     |
|--------|--------|------------------------------------------------------------------------------------------------------------------------------------------|
| þ |   | **QUARTERLY                REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE                ACT OF                1934** |

**For      the quarterly period ended September 30, 2008**

**or**

|   |   |                                                                                                                                      |
|--------|--------|-------------------------------------------------------------------------------------------------------------------------------------------|
| o      |   | **TRANSITION                REPORT PURSUANT TO 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.**

*Exact      name of registrant as specified in its charter*

| **Nevada**                                       |   | **88-0097334**                       |
|--------------------------------------------------|--------|--------------------------------------|
| *(State                or other jurisdiction of* |   | *(I.R.S.                Employer*    |
| *incorporation                or organization)*  |   | *Identification                No.)* |

**11311      Reeder Road**

**Dallas,      Texas 75229**

**(972) 484-3662**

*(Address,      including zip code, and telephone*

*number,      including area code, of registrant’s*

*principal      executive offices)*

**NONE**

*(Former      name, former address and former*

*fiscal      year, if changed since last report)*

| Large                accelerated filer o | Accelerated                filer o              |
|------------------------------------------|-------------------------------------------------|
| Non-accelerated                filer o   | Smaller                reporting company þ |

| Class                                                 |   | Outstanding |
|-------------------------------------------------------|--------|-------------|
| Common                stock, $.01 par value per share |   | 9,833,635   |

----

**TABLE      OF CONTENTS**

|                        |     |                                                                                                                                      | **Page No.** |
|-----------------------------|----------|-------------------------------------------------------------------------------------------------------------------------------------------|-------------------|
|                        |     |                                                                                                                                      |              |
| **PART                I.**  |     | **FINANCIAL                INFORMATION**                                                                                                  |              |
|                        |     |                                                                                                                                      |              |
| Item                1.      |     | Consolidated                Financial Statements.                                                                                         |              |
|                        |     |                                                                                                                                      |              |
|                        |     | Consolidated                Balance Sheets as of September 30, 2008 and December 31,                2007                                  | 1                 |
|                        |     |                                                                                                                                      |              |
|                        |     | Consolidated                Statements of Operations for the three months ended September 30,                2008 and                2007 | 2                 |
|                        |     |                                                                                                                                      |              |
|                        |     | Consolidated                Statements of Operations for the nine months ended September 30,                2008 and                2007  | 3                 |
|                        |     |                                                                                                                                      |              |
|                        |     | Consolidated                Statements of Cash Flows for the nine months ended September 30,                2008 and                2007  | 4                 |
|                        |     |                                                                                                                                      |              |
|                        |     | Notes                to Consolidated Financial Statements                                                                                 | 5                 |
|                        |     |                                                                                                                                      |              |
| Item                2.      |     | Management’s                Discussion and Analysis of Financial Condition and Results of                Operations.                | 11                |
|                        |     |                                                                                                                                      |              |
| Item                3.      |     | Quantitative                and Qualitative Disclosures About Market Risk.                                                                | 17                |
|                        |     |                                                                                                                                      |              |
| Item                4.      |     | Controls                and Procedures.                                                                                                   | 17                |
|                        |     |                                                                                                                                      |              |
| **PART                II.** |     | **OTHER                INFORMATION**                                                                                                      |              |
|                        |     |                                                                                                                                      |              |
| Item                3.      |     | Legal                Proceedings.                                                                                                         | 18                |
|                        |     |                                                                                                                                      |              |
| Item                4.      |     | Submission                of Matters to a Vote of Security Holders.                                                                       | 18                |
|                        |     |                                                                                                                                      |              |
| Item                5.      |     | Other                Information.                                                                                                         | 18                |
|                        |     |                                                                                                                                      |              |
| Item                6.      |     | Exhibits.                                                                                                                                 | 19                |
|                        |     |                                                                                                                                      |              |
| SIGNATURES                  |  23 |

----

***DGSE      Companies, Inc. and Subsidiaries***

**PART      I. FINANCIAL INFORMATION**

**Item      1. Consolidated Financial Statements.**

**CONSOLIDATED      BALANCE SHEETS**

|                                                                                                                                                                                                                                   |   | **September 30,****2008** |       | **December 31,****2007** |   |
|----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------------------------------|------------|-------------------------------|--------|
|                                                                                                                                                                                                                                   |   | **Unaudited**                  |       |                          |   |
| **ASSETS**                                                                                                                                                                                                                             |   |                           |       |                          |   |   |   |
| Current                Assets:                                                                                                                                                                                                         |   |                           |       |                          |   |   |   |
| Cash                and cash equivalents                                                                                                                                                                                          |   | $                              | 1,934,513  |                          | $      | 536,548 |   |
| Trade                receivables                                                                                                                                                                                                       |   |                           | 4,364,901  |                          |   | 3,792,474 |   |
| Auction                advances                                                                                                                                                                                                        |   |                           | 482,391    |                          |   | 747,000 |   |
| Inventories                                                                                                                                                                                                                            |   |                           | 15,099,533 |                          |   | 12,975,782 |   |
|  Prepaid                expenses                                                                                                                                                                                                  |   |                           | 241,023    |                          |   | 459,486 |   |
| Prepaid                federal income tax                                                                                                                                                                                              |   |                           | —    |                          |   | 59,341 |   |
| Total                current assets                                                                                                                                                                                                    |   |                           | 22,122,361 |                          |   | 18,570,631 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
| Marketable                securities – available for sale                                                                                                                                                                        |   |                           | 20,532     |                          |   | 61,769 |   |
| Property                and equipment, net                                                                                                                                                                                             |   |                           | 4,814,086  |                          |   | 4,193,869 |   |
| Deferred                income taxes                                                                                                                                                                                                   |   |                           | 1,717,131  |                          |   | 1,805,205 |   |
| Goodwill                                                                                                                                                                                                                               |   |                           | 9,035,380  |                          |   | 8,952,181 |   |
| Intangible                assets                                                                                                                                                                                                       |   |                           | 2,499,840  |                          |   | 2,521,340 |   |
| Other                long-term receivable                                                                                                                                                                                              |   |                           | 385,383    |                          |   | 444,383 |   |
| Other                assets                                                                                                                                                                                                            |   |                           | 193,703    |                          |   | 309,836 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
|                                                                                                                                                                                                                                   |   | $                              | 40,788,416 |                          | $      | 36,859,214 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
| **LIABILITIES**                                                                                                                                                                                                                        |   |                           |       |                          |   |   |   |
| Current                Liabilities:                                                                                                                                                                                                    |   |                           |       |                          |   |   |   |
| Notes                payable                                                                                                                                                                                                           |   | $                              | 187,463    |                          | $      | 187,467 |   |
| Current                maturities of long-term debt                                                                                                                                                                                    |   |                           | 501,631    |                          |   | 501,631 |   |
| Accounts                payable – trade                                                                                                                                                                                          |   |                           | 388,548    |                          |   | 1,069,194 |   |
| Federal                income tax payable                                                                                                                                                                                              |   |                           | 199,554    |                          |   | — |   |
| Accrued                expenses                                                                                                                                                                                                        |   |                           | 2,484,957  |                          |   | 1,018,003 |   |
| Customer                deposits                                                                                                                                                                                                       |   |                           | 867,588    |                          |   | 315,437 |   |
| Total                current liabilities                                                                                                                                                                                               |   |                           | 4,629,741  |                          |   | 3,091,732 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
| Long-term                debt, less current maturities                                                                                                                                                                                 |   |                           | 14,734,553 |                          |   | 13,489,901 |   |
|                                                                                                                                                                                                                                   |   |                           | 19,364,294 |                          |   | 16,581,633 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
| **STOCKHOLDERS’                EQUITY**                                                                                                                                                                                          |   |                           |       |                          |   |   |   |
| Common                stock, $.01 par value; 30,000,000 shares authorized; 9,833,635 and                9,490,357 shares issued and outstanding at the end of each period                in 2008                and 2007, respectively |   |                           | 98,337     |                          |   | 94,904 |   |
| Additional                paid-in capital                                                                                                                                                                                              |   |                           | 18,503,353 |                          |   | 18,473,234 |   |
| Accumulated                other comprehensive loss                                                                                                                                                                                    |   |                           | (117,264   | )                             |   | (97,288 | ) |
| Retained                earnings                                                                                                                                                                                                       |   |                           | 2,939,696  |                          |   | 1,806,731 |   |
|                                                                                                                                                                                                                                   |   |                           | 21,424,122 |                          |   | 20,277,581 |   |
|                                                                                                                                                                                                                                   |   |                           |       |                          |   |   |   |
|                                                                                                                                                                                                                                   |   | $                              | 40,788,416 |                          | $      | 36,859,214 |   |

----

***DGSE      Companies, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                                                                                                                |   | **Three months ended September 30,** |       |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|----------------------------------------------------------|------------|
|                                                                                                                                                                |   | **2008**                                                 |       | **2007** |   |
|                                                                                                                                                                |   | **Unaudited**                                            |       |
| Revenue                                                                                                                                                             |   |                                                     |       |   |   |   |   |
| Sales                                                                                                                                                          |   | $                                                        | 24,345,861 |   | $ | 16,771,838 |   |
| Consumer                loan service charges                                                                                                                   |   |                                                     | 145,320    |   |   | 84,475 |   |
|                                                                                                                                                                |   |                                                     | 24,491,181 |   |   | 16,856,313 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Costs                and expenses                                                                                                                                   |   |                                                     |       |   |   |   |   |
| Cost                of goods sold                                                                                                                              |   |                                                     | 20,664,436 |   |   | 13,891,332 |   |
| Selling,                general and administrative expenses                                                                                                    |   |                                                     | 3,309,030  |   |   | 2,726,610 |   |
| Depreciation                and amortization                                                                                                                   |   |                                                     | 88,422     |   |   | 96,584 |   |
|                                                                                                                                                                |   |                                                     | 24,061,888 |   |   | 16,714,526 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Operating                income                                                                                                                                     |   |                                                     | 429,293    |   |   | 141,787 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Other                expense (income)                                                                                                                               |   |                                                     |       |   |   |   |   |
| Other                income                                                                                                                                    |   |                                                     | (2,152     | ) |   | (577,198 | ) |
| Interest                expense                                                                                                                                |   |                                                     | 180,255    |   |   | 182,704 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Earnings                before income taxes                                                                                                                         |   |                                                     | 251,190    |   |   | 536,281 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Income                tax expense                                                                                                                              |   |                                                     | 85,404     |   |   | 182,336 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Net                earnings from continuing operations                                                                                                              |   |                                                     | 165,786    |   |   | 353,945 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Discontinued                operations:                                                                                                                        |   |                                                     |       |   |   |   |   |
| Loss                from discontinued operations (less applicable income tax benefit                of $0 and                $771, respectively)               |   |                                                     | —    |   |   | 1,498 |   |
| Loss                on disposal of discontinued operations (less applicable income tax                benefit                of $0 and $35,053, respectively)  |   |                                                     | —    |   |   | 68,043 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Net                earnings                                                                                                                                    |   | $                                                        | 165,786    |   | $ | 284,404 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Earnings                per common share – basic                                                                                                         |   | $                                                        | 0.02       |   | $ | 0.03 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Earnings                per common share – diluted                                                                                                       |   | $                                                        | 0.02       |   | $ | 0.03 |   |
|                                                                                                                                                                |   |                                                     |       |   |   |   |   |
| Weighted                average number of common shares:                                                                                                            |   |                                                     |       |   |   |   |   |
| Basic                                                                                                                                                          |   |                                                     | 9,833,635  |   |   | 8,582,357 |   |
| Diluted                                                                                                                                                        |   |                                                     | 10,344,363 |   |   | 10,392,717 |   |

----

***DGSE      Companies, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF OPERATIONS**

|                                                                                                                                                                |   | **Nine months ended September 30,** |       |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------|------------|
|                                                                                                                                                                |   | **2008**                                                |       | **2007** |   |
|                                                                                                                                                                |   | **Unaudited**                                           |       |
| Revenue                                                                                                                                                             |   |                                                    |       |   |   |   |   |
| Sales                                                                                                                                                          |   | $                                                       | 83,193,480 |   | $ | 39,100,108 |   |
| Consumer                loan service charges                                                                                                                   |   |                                                    | 400,489    |   |   | 193,775 |   |
| Management                fees                                                                                                                                 |   |                                                    | —    |   |   | 250,000 |   |
|                                                                                                                                                                |   |                                                    | 83,593,969 |   |   | 39,543,883 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Costs                and expenses                                                                                                                                   |   |                                                    |       |   |   |   |   |
| Cost                of goods sold                                                                                                                              |   |                                                    | 71,296,196 |   |   | 32,518,275 |   |
| Selling,                general and administrative expenses                                                                                                    |   |                                                    | 9,910,879  |   |   | 5,697,795 |   |
| Depreciation                and amortization                                                                                                                   |   |                                                    | 281,654    |   |   | 196,127 |   |
|                                                                                                                                                                |   |                                                    | 81,488,729 |   |   | 38,412,197 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Operating                income                                                                                                                                     |   |                                                    | 2,105,240  |   |   | 1,131,686 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Other                expense (income)                                                                                                                               |   |                                                    |       |   |   |   |   |
| Other                income                                                                                                                                    |   |                                                    | (27,493    | ) |   | (579,449 | ) |
| Interest                expense                                                                                                                                |   |                                                    | 555,422    |   |   | 427,840 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Earnings                before income taxes                                                                                                                         |   |                                                    | 1,577,311  |   |   | 1,283,295 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Income                tax expense                                                                                                                              |   |                                                    | 444,346    |   |   | 436,321 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Net                earnings from continuing operations                                                                                                              |   |                                                    | 1,132,965  |   |   | 846,974 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Discontinued                operations:                                                                                                                        |   |                                                    |       |   |   |   |   |
| Loss                from discontinued operations (less applicable income tax benefit                of $0 and                $17,659, respectively)            |   |                                                    | —    |   |   | 34,279 |   |
| Loss                on disposal of discontinued operations (less applicable income tax                benefit                of $0 and $35,053, respectively)  |   |                                                    | —    |   |   | 68,043 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Net                earnings                                                                                                                                    |   | $                                                       | 1,132,965  |   | $ | 744,652 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Earnings                per common share – basic                                                                                                         |   | $                                                       | 0.12       |   | $ | 0.11 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Earnings                per common share – diluted                                                                                                       |   | $                                                       | 0.11       |   | $ | 0.10 |   |
|                                                                                                                                                                |   |                                                    |       |   |   |   |   |
| Weighted                average number of common shares:                                                                                                            |   |                                                    |       |   |   |   |   |
| Basic                                                                                                                                                          |   |                                                    | 9,666,182  |   |   | 6,543,986 |   |
| Diluted                                                                                                                                                        |   |                                                    | 10,344,363 |   |   | 7,395,848 |   |

----

***DGSE      COMPANIES, Inc. and Subsidiaries***

**CONSOLIDATED      STATEMENTS OF CASH FLOWS**

|                                                                                                             |   | **Nine months ended September 30,** |       |
|------------------------------------------------------------------------------------------------------------------|--------|---------------------------------------------------------|------------|
|                                                                                                             |   | **2008**                                                |       | **2007** |   |
| **Cash                flows from operating activities**                                                          |   | **Unaudited**                                           |
|                                                                                                             |   |                                                    |       |   |   |   |   |
| Net                earnings                                                                                 |   | $                                                       | 1,132,965  |   | $ | 744,652 |   |
| Adjustments                to reconcile net earnings to net cash provided by operating                activities |   |                                                    |       |   |   |   |   |
|  Depreciation                and amortization                                                          |   |                                                    | 281,654    |   |   | 196,127 |   |
| Deferred                income taxes                                                                        |   |                                                    | 88,074     |   |   | (10,879 | ) |
| Loss                on marketable securities                                                                |   |                                                    | 41,237     |   |   | — |   |
| Loss                on discontinued operations                                                              |   |                                                    | —    |   |   | 102,322 |   |
| Gain                on sale of building                                                                     |   |                                                    | —    |   |   | (579,447 | ) |
| (Increase)                decrease in operating assets and liabilities                                           |   |                                                    |       |   |   |   |   |
| Trade                receivables                                                                            |   |                                                    | 253,500    |   |   | (2,380,792 | ) |
| Inventories                                                                                                 |   |                                                    | (2,123,751 | ) |   | (390,218 | ) |
| Prepaid                expenses and other current assets                                                    |   |                                                    | (263,928   | ) |   | (221,140 | ) |
| Accounts                payable and accrued expenses                                                        |   |                                                    | 799,884    |   |   | (998,300 | ) |
| Customer                deposits                                                                            |   |                                                    | 552,151    |   |   | 69,549 |   |
| Federal                income taxes payable                                                                 |   |                                                    | 258,895    |   |   | 399,629 |   |
| Other                assets                                                                                 |   |                                                    | 116,133    |   |   | (98,745 | ) |
| Net                cash provided by (used in) operating activities                                               |   |                                                    | 1,136,814  |   |   | (3,167,242 | ) |
| **Cash                flows from investing activities**                                                          |   |                                                    |       |   |   |   |   |
| Pawn                loans made                                                                              |   |                                                    | (954,746   | ) |   | (391,136 | ) |
| Pawn                loans repaid                                                                            |   |                                                    | 463,118    |   |   | 241,425 |   |
| Recovery                of pawn loan principal through sale of forfeited collateral                         |   |                                                    | 471,701    |   |   | 94,973 |   |
| Pay                day loans made                                                                           |   |                                                    | —    |   |   | (164,289 | ) |
| Pay                day loans repaid                                                                         |   |                                                    | —    |   |   | 125,982 |   |
| Purchase                of property and equipment                                                           |   |                                                    | (901,871   | ) |   | (119,772 | ) |
| Proceeds                from sale of discontinued operations                                                |   |                                                    | —    |   |   | 77,496 |   |
| Proceeds                from sale of building                                                               |   |                                                    | —    |   |   | 924,742 |   |
| Acquisition                of Euless Gold & Silver                                                      |   |                                                    | —    |   |   | (600,000 | ) |
| Merger                costs paid                                                                            |   |                                                    | (61,699    | ) |   | (395,280 | ) |
| Net                cash used in investing activities                                                             |   |                                                    | (983,497   | ) |   | (205,859 | ) |
| **Cash                flows from financing activities**                                                          |   |                                                    |       |   |   |   |   |
| Proceeds                from line of credit                                                                 |   |                                                    | 2,150,000  |   |   | 4,219,352 |   |
| Conversion                of warrants                                                                       |   |                                                    | —    |   |   | 78,363 |   |
| Repayments                of notes payable                                                                  |   |                                                    | (905,352   | ) |   | (754,228 | ) |
| Net                cash provided by financing activities                                                    |   |                                                    | 1,244,648  |   |   | 3,543,487 |   |
|                                                                                                             |   |                                                    |       |   |   |   |   |
| NET                INCREASE IN CASH AND CASH EQUIVILANTS EQUIVALENTS                                             |   |                                                    | 1,397,965  |   |   | 170,386 |   |
| Cash                and cash equivalents at beginning of period                                             |   |                                                    | 536,548    |   |   | 1,210,282 |   |
| Cash                and cash equivalents at end of period                                                   |   | $                                                       | 1,934,513  |   | $ | 1,380,668 |   |

**Supplemental      disclosures:**

----

***DGSE      COMPANIES, Inc. and Subsidiaries***

**NOTES      TO CONSOLIDATED FINANCIAL STATEMENTS**

| **(1)** | **Basis                of Presentation.** |
|---------|-------------------------------------------|

| **(2)** | **Inventory.** |
|---------|----------------|

|                      |   | September 30, 2008 |       | December 31, 2007 |   |
|---------------------------|--------|------------------------------|------------|-----------------------------|--------|
| Jewelry                   |   | $                            | 10,933,486 |                        | $      | 8,118,454 |   |
| Rare                coins |   |                         | 1,651,422  |                        |   | 3,482,248 |   |
| Bullion                   |   |                         | 1,284,081  |                        |   | 486,991 |   |
| Scrap                gold |   |                         | 546,880    |                        |   | 414,099 |   |
| Other                     |   |                         | 683,664    |                        |   | 473,990 |   |
| Total                     |   | $                            | 15,099,533 |                        | $      | 12,975,782 |   |

| **(3)** | **Trade                Receivables.** |
|---------|---------------------------------------|

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

| **(4)** | **Earnings                per share.** |
|---------|----------------------------------------|

|                                             |   | **2008**                                                       |    | **2007**                                                       |   |
|--------------------------------------------------|--------|----------------------------------------------------------------|---------|----------------------------------------------------------------|--------|
|                                             |   | **Three months ended September 30, ** |    | **Three months ended September 30, ** |   |
|                                             |   | **Net Earnings**                                          |    | **Shares**                                                     |   | **Per share** |   | **Net Earnings** |   | **Shares** |   | **Per share** |   |
|                                             |   |                                                           |    |                                                           |   |   |   |   |   |   |   |   |   |
| Basic                earnings per common share   |   | $                                                              | 165,786 |                                                           |   | 9,833,635 |   | $ | 0.02 |   | $ | 284,404 |   |   | 8,582,357 |   | $ | 0.03 |   |
| Effect                of dilutive stock options  |   |                                                           | — |                                                           |   | 510,728 |   |   | — |   |   | — |   |   | 1,810,360 |   |   | — |   |
|                                             |   |                                                           |         |                                                           |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Diluted                earnings per common share |   | $                                                              | 165,786 |                                                           |   | 10,344,363 |   | $ | 0.02 |   | $ | 284,404 |   |   | 10,392,717 |   | $ | 0.03 |   |

|                                             |   | **2008**                                                      |      | **2007**                                                |   |
|--------------------------------------------------|--------|---------------------------------------------------------------|-----------|---------------------------------------------------------|--------|
|                                             |   | **Nine months ended September 30, ** |      | **Nine months ended September 30,** |   |
|                                             |   | **Net Earnings**                                         |      | **Shares**                                              |   | **Per share** |   | **Net Earnings** |   | **Shares** |   | **Per share** |   |
|                                             |   |                                                          |      |                                                    |   |   |   |   |   |   |   |   |   |
| Basic                earnings per common share   |   | $                                                             | 1,132,965 |                                                    |   | 9,666,182 |   | $ | 0.12 |   | $ | 744,652 |   |   | 6,543,986 |   | $ | 0.11 |   |
| Effect                of dilutive stock options  |   |                                                          | —   |                                                    |   | 678,181 |   |   | (0.01 | ) |   | — |   |   | 851,862 |   |   | (0.01 | ) |
|                                             |   |                                                          |           |                                                    |   |  |   |   |  |   |   |  |   |   |  |   |   |  |   |
| Diluted                earnings per common share |   | $                                                             | 1,132,965 |                                                    |   | 10,344,363 |   | $ | 0.11 |   | $ | 744,652 |   |   | 7,395,848 |   | $ | 0.10 |   |

| **(5)** | **Business                segment information.** |
|---------|--------------------------------------------------|

| ***(In                thousands)***          |   | **Retail****Jewelry** |    | **Wholesale****Jewelry** |   | **Precious****Metals** |   | **Rare****Coins** |    | **Auctions** |   | **Corporate****and Other** |   | **Consolidated** |    |
|----------------------------------------------|--------|-----------------------|---------|--------------------------|--------|------------------------|--------|-------------------|---------|--------------|--------|---------------------------------|--------|------------------|---------|
| Revenues                                     |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   | $                     | 20,307  |                     | $      | 3,645                  |   | $                 | 40,256  |         | $      | 16,042                          |   | $                | 1,710   |   | $ | 1,634 |   | $ | 83,594 |   |
| 2007                                         |   |                  | 12,153  |                     |   | 3,948                  |   |              | 12,027  |         |   | 9,530                           |   |             | 1,037   |   |   | 849 |   |   | 39,544 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Net                earnings (loss)           |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 681     |                     |   | 34                     |   |              | 410     |         |   | 70                              |   |             | (14     | ) |   | (48 | ) |   | 1,133 |   |
| 2007                                         |   |                  | 325     | (1)                      |   | 93                     |   |              | 132     |         |   | 34                              |   |             | 164     |   |   | (3 | ) |   | 745 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Identifiable                assets           |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 19,315  |                     |   | 1,073                  |   |              | 1,289   |         |   | 2,801                           |   |             | 1,632   |   |   | 5,665 |   |   | 31,775 |   |
| 2007                                         |   |                  | 11,958  |                     |   | 1,067                  |   |              | 355     |         |   | 3,339                           |   |             | 1,814   |   |   | 983 |   |   | 19,516 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Goodwill                                     |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | — |                     |   | 837                    |   |              | — |         |   | —                         |   |             | — |   |   | 8,177 |   |   | 9,014 |   |
| 2007                                         |   |                  | — |                     |   | 837                    |   |              | — |         |   | —                         |   |             | — |   |   | 12,374 |   |   | 13,211 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Capital                Expenditures          |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 754     |                     |   | —                |   |              | — |         |   | —                         |   |             | 148     |   |   | — |   |   | 902 |   |
| 2007                                         |   |                  | 106     |                     |   | —                |   |              | — |         |   | —                         |   |             | — |   |   | 14 |   |   | 120 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Depreciation                and amortization |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 115     |                     |   | —                |   |              | 42      |         |   | 41                              |   |             | 41      |   |   | 43 |   |   | 282 |   |
| 2007                                         |   |                  | 91      |                     |   | —                |   |              | 18      |         |   | 18                              |   |             | 18      |   |   | 51 |   |   | 196 |   |

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

| ***(In                thousands)***          |   | **Retail****Jewelry** |    | **Wholesale****Jewelry** |   | **Precious****Metals** |   | **Rare****Coins** |    | **Auctions** |   | **Corporate****and Other** |   | **Consolidated** |    |
|----------------------------------------------|--------|-----------------------|---------|--------------------------|--------|------------------------|--------|-------------------|---------|--------------|--------|---------------------------------|--------|------------------|---------|
| Revenues                                     |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   | $                     | 6,036   |                     | $      | 1,148                  |   | $                 | 13,382  |         | $      | 2,927                           |   | $                | 496     |   | $ | 502 |   | $ | 24,491 |   |
| 2007                                         |   |                  | 4,097   |                     |   | 1,105                  |   |              | 5,740   |         |   | 4,908                           |   |             | 711     |   |   | 295 |   |   | 16,856 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Net                earnings (loss)           |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 75      |                     |   | (13                    | )      |              | 38      |         |   | 58                              |   |             | (60     | ) |   | 68 |   |   | 166 |   |
| 2007                                         |   |                  | 232(1   | )                        |   | 27                     |   |              | 63      |         |   | 4                               |   |             | 17      |   |   | (59 | ) |   | 284 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Identifiable                assets           |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 19,315  |                     |   | 1,073                  |   |              | 1,289   |         |   | 2,801                           |   |             | 1,632   |   |   | 5,665 |   |   | 31,775 |   |
| 2007                                         |   |                  | 11,958  |                     |   | 1,067                  |   |              | 355     |         |   | 3,339                           |   |             | 1,814   |   |   | 983 |   |   | 19,516 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Goodwill                                     |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | — |                     |   | 837                    |   |              | — |         |   | —                         |   |             | — |   |   | 8,177 |   |   | 9,014 |   |
| 2007                                         |   |                  | — |                     |   | 837                    |   |              | — |         |   | —                         |   |             | — |   |   | 12,374 |   |   | 13,211 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Capital                Expenditures          |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 220     |                     |   | —                |   |              | — |         |   | —                         |   |             | 37      |   |   | — |   |   | 257 |   |
| 2007                                         |   |                  | 13      |                     |   | —                |   |              | — |         |   | —                         |   |             | — |   |   | 3 |   |   | 16 |   |
|                                         |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| Depreciation                and amortization |   |                  |    |                     |   |                   |   |              |    |         |   |                            |   |             |    |   |   |   |   |   |   |   |
| 2008                                         |   |                  | 39      |                     |   | —                |   |              | 14      |         |   | 14                              |   |             | 13      |   |   | 9 |   |   | 89 |   |
| 2007                                         |   |                  | 38      |                     |   | —                |   |              | 13      |         |   | 13                              |   |             | 13      |   |   | 19 |   |   | 96 |   |

| **(6)** | **Stock-based                Compensation.** |
|---------|----------------------------------------------|

----

***DGSE        COMPANIES, Inc. and Subsidiaries***

| **(7)** | **Acquisitions** |
|---------|------------------|

*Superior      Galleries, Inc. *

|                                     |   |   |      |             |   |                |            |
|------------------------------------------|--------|--------|-----------|------------------|--------|---------------------|-----------------|
|                                     |   | Shares |      | Stock Price |   | Extended Price |            |
| Common                stock              |   |   | 3,669,067 |             | $      | 2.55                |            | $ | 9,356,121 |   |
| A                warrants                |   |   | 845,634   |             |   | 1.27                | (1)   |   | 1,073,955 |   |
| B                warrants                |   |   | 863,000   |             |   | 2.55                |            |   | 2,200,650 |   |
| Exercise                Price B warrants |   |   | 863,000   |             | $      | .001                |            |   | (863 | ) |
| Direct                transaction costs  |   |   |      |             |   |                |            |   | 1,176,290 |   |
| Total                purchase price      |   |   |      |             |   |                |            | $ | 13,806,153 |   |

|   | (1) | $1.27                is the fair value of the warrants calculated under the Black Sholes                method                as of the acquisition date. |
|--------|-----|-----------------------------------------------------------------------------------------------------------------------------------------------------------|

| Goodwill                                 |   | $      | 8,203,448  |   |
|------------------------------------------|--------|--------|------------|--------|
| Intangible                assets         |   |   | 2,521,340  |   |
| Deferred                tax asset        |   |   | 1,860,475  |   |
| Property                and other assets |   |   | 1,068,958  |   |
| Inventory                                |   |   | 3,260,766  |   |
| Liabilities                assumed       |   |   | (3,108,834 | )      |
|                                     |   |   |            |   |
| Total                purchase price      |   | $      | 13,806,153 |   |

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

|                                                                 |   | **Three Months Ended September 30,** |   |
|----------------------------------------------------------------------|--------|----------------------------------------------------------|--------|
| ***(In thousands, except per share data)*** |   | **2008**                                                 |   | **2007** |   |
|                                                                 |   | **(Unaudited)**                                          |   |
| Total                revenue                                         |   | $                                                        | 24,491 |   | $ | 16,856 |   |
| Net                earnings (loss)                                   |   | $                                                        | 166    |   | $ | 284 |   |
| Net                earnings (loss) per share — basic      |   | $                                                        | 0.02   |   | $ | 0.03 |   |
| Net                earnings (loss) per share — diluted    |   | $                                                        | 0.02   |   | $ | 0.03 |   |
| Weighted                average shares — basic            |   |                                                     | 9,834  |   |   | 8,582 |   |
| Weighted                average shares — diluted          |   |                                                     | 10,344 |   |   | 10,393 |   |

|                                                              |   | **Nine Months Ended September 30,** |   |
|-------------------------------------------------------------------|--------|---------------------------------------------------------|--------|
| ***(In                thousands, except per share data)***        |   | **2008**                                                |   | **2007** |   |
|                                                              |   | **(Unaudited)**                                         |   |
|                                                              |   |                                                    |   | (Pro                forma) |   |
| Total                revenue                                      |   | $                                                       | 83,594 |   | $ | 50,142 |   |
| Net                earnings (loss)                                |   | $                                                       | 1,133  |   | $ | (2,932 | ) |
| Net                earnings (loss) per share — basic   |   | $                                                       | 0.12   |   | $ | (0.37 | ) |
| Net                earnings (loss) per share — diluted |   | $                                                       | 0.11   |   | $ | (0.37 | ) |
| Weighted                average shares — basic         |   |                                                    | 9,666  |   |   | 7,857 |   |
| Weighted                average shares — diluted       |   |                                                    | 10,344 |   |   | 8,709 |   |

*Euless      Gold & Silver, Inc.*

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

| **(8)** | **New                Accounting Pronouncements** |
|---------|--------------------------------------------------|

| **(9)** | **Related                Party Transactions** |
|---------|-----------------------------------------------|

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Item      2. Management’s Discussion and Analysis of Financial Condition and Results of      Operations.**

**Forward-Looking      Statements**

**Our      Business**

** **

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Significant      Accounting Policies**

*Inventory.*
** **

*Accounts      Receivable.*
** **

*Auction      Advances. *

*Revenue      Recognition.*

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

*Exchanges      of Nonmonetary Assets – An Amendment of APB Opinion No. 29*

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Results      of Operations**

**Three      Months Ended September 30, 2008 compared to Three Months Ended September 30,      2007**

**Nine      Months Ended September 30, 2008 compared to Nine Months Ended September 30,      2007**

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Liquidity      and Capital Resources**

| As                of September 30, 2008                        |   | Requirement                              |   | Actual                calculation |
|----------------------------------------------------------------|--------|------------------------------------------|--------|-----------------------------------|
| Minimum                tangible net worth                      |   | 6,500,000                                |   | 9,969,414                         |
| Maximum                total liabilities to tangible net worth |   | Not                to exceed 1.50        |   | 1.07                              |
| Minimum                debt service coverage                   |   | Must                be greater than 1.35 |   | 3.45                              |

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

|                                               |   |      |       |     |   | **Payments due by period** |   | ** **                |      |
|----------------------------------------------------|--------|-----------|------------|----------|--------|-------------------------------------------|--------|---------------------------|-----------|
| **Contractual Cash Obligations**         |   | **Total** |       | **2008** |   | **2009 - 2010**                 |   | **2011 - 2012** |      | **Thereafter** |   |
| Notes                  payable                |   | $         | 187,463    |     | $      | 187,463                                   |   | $                         | —   |   | $ | — |   | $ | — |   |
| Long-term                  debt and capital leases |   |      | 15,236,184 |     |   | 124,216                                   |   |                      | 4,807,752 |   |   | 8,492,048 |   |   | 1,812,168 |   |
| Federal                  income taxes         |   |      | 199,554    |     |   | 199,554                                   |   |                      | —   |   |   | — |   |   | — |   |
| Operating                  Leases                  |   |      | 2,812,033  |     |   | 158,969                                   |   |                      | 1,290,021 |   |   | 1,206,633 |   |   | 156,410 |   |
| Total                                              |   | $         | 18,435,234 |     | $      | 670,202                                   |   | $                         | 6,097,773 |   | $ | 9,698,681 |   | $ | 1,968,578 |   |

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Item      3. Quantitative and Qualitative Disclosures About Market      Risk.**

**Item      4. Controls and Procedures.**

*Evaluation      of disclosure controls and procedures*

*Changes      in internal controls.*

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**PART      II- OTHER INFORMATION**

**Item      3. Legal Proceedings **

**Item      4. Submission of Matters to a Vote of Security Holders.**

| **Proposal**                                                                                                                                                                                |   | **For** |      | **Against** |   | **Abstain** |   |
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|---------|-----------|-------------|--------|-------------|--------|
| Election                of the following directors to our board of directors:                                                                                                               |   |    |      |        |   |        |   |
|                                                                                                                                                                                        |   |    |      |        |   |        |   |
| Dr.                L.S. Smith, Ph.D                                                                                                                                                         |   |    | 9,698,106 |        |   | 273         |   |   | 5,772 |   |
| William                H. Oyster                                                                                                                                                            |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
| Dr.                William P. Cordeiro, Ph.D.                                                                                                                                               |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
| Craig                Alan-Lee                                                                                                                                                               |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
| Richard                M. Gozia                                                                                                                                                             |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
| David                Rector                                                                                                                                                                 |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
| Mitchell                T. Stoltz                                                                                                                                                           |   |    | 9,698,379 |        |   | —     |   |   | 5,772 |   |
|                                                                                                                                                                                        |   |    |      |        |   |        |   |   |   |   |
| To                ratify the selection of BKR Cornwell Jackson as our independent registered                public account firm for our fiscal year ending December 31,                2008 |   |    | 9,703,918 |        |   | 3,350       |   |   | 39 |   |

**Item      5. Other Information.**

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

**Item      6.**
**Exhibits      and Reports on Form 8-K.**

**Exhibits:**

| **Exhibit**   |   |                                                                                                                                                |   | **Filed**   |   |  **Incorporated**      |   |     |   | **Date Filed**                 |   | **Exhibit**  |   |
|---------------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------|--------|------------------|--------|-----------------------------|--------|----------|--------|-------------------------------------|--------|-------------------|--------|
|  **No.** |   |  **Description**                                                                                                                               |   | **Herein**  |   | **by Reference**  |   | **Form** |   | **with SEC**                   |   | **No.**      |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 2.1           |   | Amended                and Restated Agreement and Plan of Merger and Reorganization, dated                as of                January 6, 2007 |   |             |   | ×                      |   | 8-K      |   | January 9,                2007 |   | 2.1               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 2.2           |   | Limited                Joinder Agreement, dated as of January 6, 2007                                                                          |   |             |   | ×                      |   | 8-K      |   | January 9,                2007 |   | 2.9               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.1           |   | Articles                of Incorporation dated September 17, 1965                                                                              |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.1               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.2           |   | Certificate                of Amendment to Articles of Incorporation, dated October 14,                1981                                    |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.2               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.3           |   | Certificate                of Resolution, dated October 14, 1981                                                                               |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.3               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.4           |   | Certificate                of Amendment to Articles of Incorporation , dated July 15,                1986                                      |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.4               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.5           |   | Certificate                of Amendment to Articles of Incorporation, dated August 23,                1998                                     |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.5               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.6           |   | Certificate                of Amendment to Articles of Incorporation, dated June 26,                1992                                       |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.6               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.7           |   | Certificate                of Amendment to Articles of Incorporation, dated June 26,                2001                                       |   |             |   | ×                      |   | 8-K      |   | July 3,                2001    |   | 1.0               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.8           |   | Certificate                of Amendment to Articles of Incorporation, dated May 22,                2007                                             |   |             |   | x                           |   | 8-K      |   | May                31, 2007         |   | 3.1               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 3.9           |   | By-laws,                dated March 2, 1992                                                                                                    |   |             |   | ×                      |   | 8-A12G   |   | June 23,                1999   |   | 3.7               |   |
|          |   |                                                                                                                                                |   |             |   |                        |   |     |   |                                |   |              |   |
| 4.1           |   | Specimen                Common Stock Certificate                                                                                                    |   |             |   | ×                      |   | S-4      |   | January 6,                2007 |   | 4.1               |   |

----

***DGSE      COMPANIES, Inc. and      Subsidiaries***

| 10.1   |   | Renewal,                Extension And Modification Agreement dated January 28, 1994, by and                among                DGSE Corporation and Michael E. Hall And Marian E. Hall |   |   |   | × |   | 10-KSB |   | March                1995           |   | 10.2   |   |
|--------|--------|-----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-------------------------------------|--------|--------|--------|
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.2   |   | Lease                Agreement dated June 2, 2000 by and between SND Properties and                Charleston Gold and Diamond Exchange, Inc.                                      |   |   |   | × |   | 10-KSB |   | March 29,                2001  |   | 10.1   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.3   |   | Lease                agreement dated October 5, 2004 by and between Beltline Denton Road                Associates and Dallas Gold & Silver Exchange                                |   |   |   | × |   | 10-K   |   | April 15,                2005  |   | 10.2   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.4   |   | Lease                agreement dated December 1, 2004 by and between Stone Lewis Properties                and                Dallas Gold & Silver Exchange                         |   |   |   | × |   | 10-K   |   | April 15,                2005  |   | 10.3   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.5   |   | Lease                agreement dated November 18, 2004 by and between Hinkle Income Properties                LLC and American Pay Day Centers, Inc.                                    |   |   |   | × |   | 10-K   |   | April 15,                2005  |   | 10.4   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.6   |   | Lease                Agreement dated January 17, 2005 by and between Belle-Hall Development                Phase III Limited Partnership and DGSE Companies, Inc.                       |   |   |   | × |   | S-4    |   | January 6,                2007 |   | 10.6   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.7   |   | Sale                agreement dated executed July 5, 2007 by and between DGSE Companies,                Inc. and Texas Department of Transportation                                |   |   |   | × |   | 8-K    |   | July                11, 2007        |   | 10.1   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.8   |   | Purchase                agreement dated July 5, 2007 by and between DGSE Companies, Inc. and                11311 Reeder Road Holdings, LP                                         |   |   |   | × |   | 8-K    |   | July                11, 2007        |   | 10.2   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.9   |   | Loan                Agreement, dated as of December 22, 2005, between DGSE Companies,                Inc. and Texas Capital Bank, N.A.                                             |   |   |   | × |   | 8-K/A  |   | August 17,                2006 |   | 10.1   |   |
|   |   |                                                                                                                                                                                    |   |   |   |   |   |   |   |                                |   |   |   |
| 10.10  |   | Third                Amendment to Loan Agreement, dated as of May 10, 2007, by and between                DGSE                Companies, Inc. and Texas Capital Bank, N.A.              |   |   |   | × |   | 8-K    |   | May                9, 2007          |   | 3.0    |   |

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***DGSE      COMPANIES, Inc. and      Subsidiaries***

| 10.11  |   | Support                Agreement, DGSE stockholders, dated as of January 6,                2007                                                                                                                           |   |   |   | × |   | 8-K    |   | January 9,                2007 |   | 99.1   |   |
|--------|--------|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-------------------------------------|--------|--------|--------|
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.12  |   | Securities                Exchange Agreement, dated as of January 6, 2007                                                                                                                                                 |   |   |   | × |   | 8-K    |   | January 9,                2007 |   | 99.2   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.13  |   | Warrant                to DiGenova, issued January 6, 2007                                                                                                                                                                |   |   |   | × |   | 8-K    |   | January 9,                2007 |   | 99.3   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.14  |   | Support                Agreement, Superior stockholders, dated as of January 6,                2007                                                                                                                       |   |   |   | × |   | 8-K    |   | January 9,                2007 |   | 99.5   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.15  |   | Asset                purchase agreement, dated May 9, 2007, by and between DGSE Companies,                Inc.                and Euless Gold & Silver, Inc.                                                               |   |   |   | × |   | 8-K    |   | May                9, 2007          |   | 1.0    |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.16  |   | Subordinated                Promissory Note dated May 9, 2007                                                                                                                                                                  |   |   |   | × |   | 8-K    |   | May                9, 2007          |   | 2.0    |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.17  |   | Registration                Rights Agreement with Stanford International Bank Ltd., dated as                of May                30, 2007                                                                                     |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.1   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.18  |   | Corporate                Governance Agreement with Dr. L.S. Smith and Stanford International                Bank                Ltd., dated as of May 30, 2007                                                                 |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.2   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.19  |   | Escrow                Agreement with American Stock Transfer & Trust Company and Stanford                International Bank Ltd., as stockholder agent, dated as of May 30,                2007                            |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.3   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.20  |   | Form                of Warrants                                                                                                                                                                                                |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.4   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.21  |   | Amended                and Restated Commercial Loan and Security Agreement, by and between                Superior Galleries Inc. and Stanford International Bank Ltd., dated                as of                May 30, 2007 |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.5   |   |
|   |   |                                                                                                                                                                                                                           |   |   |   |   |   |   |   |                                |   |   |   |
| 10.22  |   | Employment                Agreement with L.S. Smith, dated as of May 30, 2007                                                                                                                                                  |   |   |   | × |   | 8-K    |   | May                31, 2007         |   | 99.6   |   |

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***DGSE      COMPANIES, Inc. and      Subsidiaries***

| 10.23  |   | Employment                Agreement with William H. Oyster, dated as of May 30, 2007                                                                                                                                |   |   |   | × |   | 8-K    |   | May                31, 2007 |   | 99.7   |   |
|--------|--------|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------|--------|--------|--------|--------|--------|--------|--------|-----------------------------|--------|--------|--------|
|   |   |                                                                                                                                                                                                                |   |   |   |   |   |   |   |                        |   |   |   |
| 10.24  |   | Employment                Agreement with John Benson, dated as of May 30, 2007                                                                                                                                      |   |   |   | × |   | 8-K    |   | May                31, 2007 |   | 99.8   |   |
|   |   |                                                                                                                                                                                                                |   |   |   |   |   |   |   |                        |   |   |   |
| 31.1   |   | Certification                pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934                implementing Section 302 of the Sarbanes-Oxley Act of 2002 by Dr.                L.S. Smith |   | × |   |   |   |   |   |                        |   |   |   |
|   |   |                                                                                                                                                                                                                |   |   |   |   |   |   |   |                        |   |   |   |
| 31.2   |   | Certification                pursuant to Rule 13a-14(a) of the Securities Exchange Act of 1934                implementing Section 302 of the Sarbanes-Oxley Act of 2002 by John                Benson    |   | × |   |   |   |   |   |                        |   |   |   |
|   |   |                                                                                                                                                                                                                |   |   |   |   |   |   |   |                        |   |   |   |
| 32.1   |   | Certification                pursuant to 18 U.S.C. Section 1350 as adopted pursuant to                Section 906 of the Sarbanes-Oxley Act of 2002 by Dr. L.S.                Smith                      |   | × |   |   |   |   |   |                        |   |   |   |
|   |   |                                                                                                                                                                                                                |   |   |   |   |   |   |   |                        |   |   |   |
| 32.2   |   | Certification                pursuant to 18 U.S.C. Section 1350 as adopted pursuant to                Section 906 of the Sarbanes-Oxley Act of 2002 by John                Benson                         |   | × |   |   |   |   |   |                        |   |   |   |

**Reports      on Form 8-K :**

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**SIGNATURES**

| DGSE                  Companies, Inc. |                                           |   |
|---------------------------------------|------------------------------------------------|--------|
|                                  |                                           |   |   |
| By:                                   | /s/                    L. S. Smith             |   | Dated:                    November 13, 2008 |
|                                  | L.                    S. Smith                 |   |   |
|                                  | Chairman                    of the Board,      |   |   |
|                                  | Chief                    Executive Officer and |   |   |
|                                  | Secretary                                      |   |   |

| By:    | /s/                  L. S. Smith                |   | Dated:                  November 13, 2008 |
|--------|-------------------------------------------------|--------|-------------------------------------------|
|   | L.                  S. Smith                    |   |                                      |
|   | Chairman                  of the Board,         |   |                                      |
|   | Chief                  Executive Officer and    |   |                                      |
|   | Secretary                                       |   |                                      |
|   |                                            |   |                                      |
|   |                                            |   |                                      |
| By:    | /s/                  W. H. Oyster               |   | Dated:                  November 13, 2008 |
|   | W.                  H. Oyster                   |   |                                      |
|   | Director,                  President and        |   |                                      |
|   | Chief                  Operating Officer        |   |                                      |
|   |                                            |   |                                      |
|   |                                            |   |                                      |
| By:    | /s/                  John Benson                |   | Dated:                  November 13, 2008 |
|   | John                  Benson                    |   |                                      |
|   | Chief                  Financial Officer        |   |                                      |
|   | (Principal                  Accounting Officer) |   |                                      |

----