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                                                                   EXHIBIT 10.31

                        WILSONS THE LEATHER EXPERTS INC.
                             1998 STOCK OPTION PLAN
                                        
     1.  PURPOSE.  The purpose of this 1998 Stock Option Plan (the "Plan") is to
promote the interests of Wilsons The Leather Experts Inc., a Minnesota
corporation (the "Company"), and its shareholders by providing personnel of the
Company and any subsidiaries thereof with an opportunity to acquire a
proprietary interest in the Company and thereby develop a stronger incentive to
put forth maximum effort for the continued success and growth of the Company.
In addition, the opportunity to acquire a proprietary interest in the Company
will aid in attracting and retaining personnel of outstanding ability.

     2.  ADMINISTRATION.

          (a) General.  This Plan shall be administered by a committee of two or
     more directors of the Company (the "Committee") appointed by the Company's
     Board of Directors (the "Board"). If the Board has not appointed a
     committee to administer this Plan, then the Board shall constitute the
     Committee. The Committee shall have the power, subject to the limitations
     contained in this Plan, to fix any terms and conditions for the grant or
     exercise of any option under this Plan. No director shall serve as a member
     of the Committee unless such director shall be a "non-employee director" as
     that term is defined in Rule 16b-3 promulgated under the Securities
     Exchange Act of 1934, as amended (the "Exchange Act"), or any successor
     statute or regulation comprehending the same subject matter. A majority of
     the members of the Committee shall constitute a quorum for any meeting of
     the Committee, and the acts of a majority of the members present at any
     meeting at which a quorum is present or the acts unanimously approved in
     writing by all members of the Committee shall be the acts of the Committee.
     Subject to the provisions of this Plan, the Committee may from time to time
     adopt such rules for the administration of this Plan as it deems
     appropriate. The decision of the Committee on any matter affecting this
     Plan or the rights and obligations arising under this Plan or any option
     granted hereunder, shall be final, conclusive and binding upon all persons,
     including without limitation the Company, shareholders and optionees.

          (b) Indemnification. To the full extent permitted by law, (i) no
     member of the Committee shall be liable for any action or determination
     taken or made in good faith with respect to this Plan or any option granted
     hereunder and (ii) the members of the Committee and each person to whom the
     Committee delegates authority under this Plan shall be entitled to
     indemnification by the Company against and from any loss incurred by such
     member or person by reason of any such actions and determinations.

          (c) Delegation of Authority.  The Committee may delegate all or any
     part of its authority under this Plan to the Chief Executive Officer of the
     Company for
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     purposes of granting and administering awards granted to persons other
     than persons who are then subject to the reporting requirements of Section
     16 of the Exchange Act ("Section 16 Individuals").  The Chief Executive
     Officer of the Company may, in turn, delegate such authority to such other
     officer of the Company as the Chief Executive Officer may determine.

     3.  SHARES.  The shares that may be made subject to options granted under
this Plan shall be authorized and unissued shares of Common Stock of the Company
without designation as to class, par value $0.01 per share ("Shares," and each
individually a "Share"), and they shall not exceed 500,000 Shares in the
aggregate, subject to adjustment as provided in paragraph 13, below, except
that, if any option lapses or terminates for any reason before such option has
been completely exercised, the Shares covered by the unexercised portion of such
option may again be made subject to options granted under this Plan.

     4.  ELIGIBLE PARTICIPANTS.  For purposes of this Plan, any person who is
employed by the Company, or any parent or subsidiary thereof, is referred to
herein as an "Associate."  Options may be granted under this Plan to any
Associate who is not an officer or director of the Company.  The Associates to
whom options may be granted pursuant to this paragraph 4 are referred to herein
as "Eligible Participants."

     5.  TERMS AND CONDITIONS OF ASSOCIATE OPTIONS.

          (a) General.  Subject to the terms and conditions of this Plan, the
     Committee may, from time to time during the term of this Plan, grant to
     such Eligible Participants as the Committee may determine options to
     purchase such number of Shares of the Company on such terms and conditions
     as the Committee may determine.  In determining the Eligible Participants
     to whom options shall be granted and the number of Shares to be covered by
     each option, the Committee may take into account the nature of the services
     rendered by the respective Eligible Participants, their present and
     potential contributions to the success of the Company, and such other
     factors as the Committee in its sole discretion may deem relevant.  The
     date and time of approval by the Committee of the granting of an option
     shall be considered the date and the time of the grant of such option.
     Options granted under this Plan are non-statutory options and are not
     "incentive stock options" as defined in Section 422 of the Internal Revenue
     Code of 1986, as amended (the "Code").

          (b) Purchase Price.  The purchase price of each Share subject to an
     option granted pursuant to this paragraph 5 shall be fixed by the Committee
     but shall not be less than 85% of the Fair Market Value of a Share on the
     date of grant.

          (c) Vesting.  Each option agreement provided for in paragraph 6 shall
     specify when each option granted under this Plan shall become exercisable
     with respect to the Shares covered by the option.  Notwithstanding the
     provisions of any 

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     option agreement provided for in paragraph 6, the Committee may, in its
     sole discretion, declare at any time that any option granted under this
     Plan shall be immediately exercisable.

          (d) Termination.  Each option granted pursuant to this paragraph 5
     shall expire, and all rights to purchase Shares thereunder shall terminate,
     on the earliest of:

                (i)     ten years after the date such option is granted or on
          such date prior thereto as may be fixed by the Committee on or before
          the date such option is granted;

                (ii)    the expiration of the period after the termination of
          the optionee's employment within which the option is exercisable as
          specified in paragraph 10(b) or 10(c), whichever is applicable
          (provided that the Committee may, in any option agreement provided for
          in paragraph 6 or by Committee action with respect to any outstanding
          option, extend the periods specified in paragraph 10(b) and 10(c)); or

                (iii)   the date, if any, fixed for cancellation pursuant to
          paragraph 11(c) or 12 below.

     6.  OPTION AGREEMENTS.  All options granted under this Plan shall be
evidenced by a written agreement in such form or forms as the Committee may from
time to time determine.  So long as the Shareholder Agreement dated as of May
25, 1996, among Leather Investors Limited Partnership I, Leather Investors
Limited Partnership II, Joel Waller, David Rogers, certain investors and
managers named in the signature pages thereto, and the Company (the "Shareholder
Agreement") is in effect with respect to any share of Common Stock of the
Company, each option agreement will provide that any person exercising an option
will execute and deliver to the Company an agreement to subscribe to the terms
and conditions of the Shareholder Agreement at the time of such option exercise.

     7.  FAIR MARKET VALUE.  For purposes of this Plan, the "Fair Market Value"
of a Share at a specified date shall, unless otherwise expressly provided in
this Plan, mean the closing sale price of a Share on the date immediately
preceding such date or, if no sale of Shares shall have occurred on that date,
on the next preceding day on which a sale of Shares occurred, on the Composite
Tape for New York Stock Exchange listed shares or, if Shares are not quoted on
the Composite Tape for New York Stock Exchange listed shares, on the Nasdaq
National Market or any similar system then in use or, if Shares are not included
in the Nasdaq National Market or any similar system then in use, the mean
between the closing "bid" and the closing "asked" quotation of a Share on the
date immediately preceding the date as of which such Fair Market Value is being
determined, or, if no closing bid or asked quotation is made on that date, on
the next preceding day on which a quotation is made, on 

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the Nasdaq SmallCap Market or any similar system then in use, provided that if
the Shares in question are not quoted on any such system, Fair Market Value
shall be what the Committee determines in good faith to be 100% of the fair
market value of a Share as of the date in question. Notwithstanding anything
stated in this paragraph 7, if the applicable securities exchange or system has
closed for the day at the time the determination is being made, all references
in this paragraph to the date immediately preceding the date in question shall
be deemed to be references to the date in question.

     8.  MANNER OF EXERCISE.  A person entitled to exercise an option granted
under this Plan may, subject to its terms and conditions and the terms and
conditions of this Plan, exercise it in whole at any time, or in part from time
to time, by delivery to the Company at its principal executive office, to the
attention of its Vice President, Human Resources, of written notice of exercise,
specifying the number of Shares with respect to which the option is being
exercised.  The purchase price of the Shares with respect to which an option is
being exercised shall be payable in full at the time of exercise, provided that,
to the extent permitted by law, the holder of an option may simultaneously
exercise an option and sell all or a portion of the Shares thereby acquired
pursuant to a brokerage or similar relationship and use the proceeds from such
sale to pay the purchase price of such Shares.  The purchase price of each Share
on the exercise of any option shall be paid in full in cash (including check,
bank draft or money order) or, at the discretion of the person exercising the
option, by delivery to the Company of unencumbered Shares, by a reduction in the
number of Shares delivered upon exercise of the option, or by a combination of
cash and such Shares (in each case such Shares having an aggregate Fair Market
Value on the date of exercise equal to the amount of the purchase price being
paid through such delivery or reduction of Shares); provided, however, that no
person shall be permitted to pay any portion of the purchase price with Shares
if, in the opinion of the Committee, payment in such manner could have adverse
financial accounting consequences for the Company.  The granting of an option to
a person shall give such person no rights as a shareholder except as to Shares
issued to such person.

     9.  TAX WITHHOLDING.  Delivery of Shares upon exercise of any stock option
granted under this Plan shall be subject to any required withholding taxes.  A
person exercising such an option may, as a condition precedent to receiving the
Shares, be required to pay the Company a cash amount equal to the amount of any
required withholdings.  In lieu of all or any part of such a cash payment, the
Committee may, but shall not be required to, provide in any option agreement
provided for in paragraph 6 (or provide by Committee action with respect to any
outstanding option) that a person exercising an option may cover all or any part
of the required withholdings, and any additional withholdings up to the amount
needed to cover the individual's full FICA and federal, state and local income
tax liability with respect to income arising from the exercise of the option,
through the delivery to the Company of unencumbered Shares, through a reduction
in the number of Shares delivered to the person exercising the option or through
a subsequent return to the Company of Shares delivered to the person exercising
the option (in each case, such Shares having an aggregate Fair Market 

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Value on the date of exercise equal to the amount of the withholding taxes being
paid through such delivery, reduction or subsequent return of Shares).

     10.  TRANSFERABILITY AND TERMINATION OF EMPLOYMENT.

          (a)  Transferability.  During the lifetime of an optionee, only
     such optionee or his or her guardian or legal representative may exercise
     options granted under this Plan, and no option granted under this Plan
     shall be assignable or transferable by the optionee otherwise than by will
     or the laws of descent and distribution or pursuant to a qualified domestic
     relations order as defined by the Code or Title I of the Employee
     Retirement Income Security Act, or the rules thereunder; provided, however,
     that any optionee may transfer an option granted under this Plan to a
     member or members of his or her immediate family (i.e., his or her
     children, grandchildren and spouse) or to one or more trusts for the
     benefit of such family members or partnerships in which such family members
     are the only partners, if (i) the option agreement with respect to such
     option, which must be approved by the Committee, expressly so provides
     either at the time of initial grant or by amendment to an outstanding
     option agreement and (ii) the optionee does not receive any consideration
     for the transfer. Any option held by any such transferee shall continue to
     be subject to the same terms and conditions that were applicable to such
     option immediately prior to its transfer and may be exercised by such
     transferee as and to the extent that such option has become exercisable and
     has not terminated in accordance with the provisions of the Plan and the
     applicable option agreement. For purposes of any provision of this Plan
     relating to notice to an optionee or to vesting or termination of an option
     upon the death, disability or termination of employment of an optionee, the
     references to "optionee" shall mean the original grantee of an option and
     not any transferee.

          (b) Termination of Employment During Lifetime.  During the lifetime of
     an optionee, an option may be exercised only while the optionee is employed
     by the Company or by a parent or subsidiary thereof, and only if such
     optionee has been continuously so employed since the date the option was
     granted, except that:

                (i)     an option shall continue to be exercisable for three
          months after termination of the optionee's employment but only to the
          extent that the option was exercisable immediately prior to such
          optionee's termination of employment;

                (ii)    in the case of an optionee who is disabled (as
          hereinafter defined) while employed, an option shall continue to be
          exercisable for one year after termination of such optionee's
          employment; and

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                (iii)   as to any optionee whose termination occurs following a
          declaration pursuant to paragraph 12 below, the option shall continue
          to be exercisable for the period of time provided for or permitted by
          such declaration.

          (c) Termination Upon Death.  With respect to an optionee whose
     employment terminates by reason of death, the option shall continue to be
     exercisable for one year after the death of such optionee.

          (d) Vesting Upon Disability or Death.  In the event of the disability
     (as hereinafter defined) or death of an optionee, any option held by such
     individual or his or her legal representative that was not previously
     exercisable shall become immediately exercisable in full if the disabled or
     deceased individual shall have been continuously employed by the Company or
     a parent or subsidiary thereof between the date such option was granted and
     the date of such disability or death. "Disability" of an optionee shall
     mean any physical or mental incapacitation whereby such optionee is
     therefore unable for a period of twelve consecutive months or for an
     aggregate of twelve months in any twenty-four consecutive month period to
     perform his or her duties for the Company or any parent or subsidiary
     thereof. "Disabled", with respect to any optionee, shall mean that such
     optionee has incurred a Disability.

          (e) Transfers and Leaves of Absence.  Neither the transfer of
     employment of a person to whom an option is granted between any combination
     of the Company, a parent corporation or a subsidiary thereof, nor a leave
     of absence granted to such person and approved by the Committee, shall be
     deemed a termination of employment for purposes of this Plan. The terms
     "parent" or "parent corporation" and "subsidiary" as used in this Plan
     shall have the meaning ascribed to "parent corporation" and "subsidiary
     corporation", respectively, in Sections 424(e) and (f) of the Code.

          (f) Right to Terminate Employment.  Nothing contained in this Plan, or
     in any option granted pursuant to this Plan, shall confer upon any optionee
     holding an option any right to continued employment by the Company or any
     parent or subsidiary of the Company or limit in any way the right of the
     Company or any such parent or subsidiary to terminate such optionee's
     employment at any time.

          (g) Expiration Date.  In no event shall any option be exercisable at
     any time after the time it shall have expired in accordance with paragraph
     5(d) of this Plan. When an option is no longer exercisable, it shall be
     deemed to have lapsed or terminated and will no longer be outstanding.

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     11.  CHANGE IN CONTROL.

          (a)  A "Change in Control" shall be deemed to have occurred if there
     shall have occurred a Change in Control as defined in that certain
     restricted stock agreement dated as of May 25, 1996 by and among the
     Company and certain employees of the Company or a direct or indirect
     subsidiary of the Company, without regard to the termination of such
     restricted stock agreement.

          (b)  Acceleration of Vesting.  Notwithstanding anything in sub-
     paragraph 5(c) above to the contrary, if a Change of Control of the Company
     shall occur, then, without any action by the Committee or the Board, each
     option granted under this Plan and not already exercised in full or
     otherwise terminated, expired or canceled shall become immediately
     exercisable in full.

          (c)  Cash Payment.  If a Change in Control of the Company shall occur,
     then, so long as a majority of the members of the Board are persons (i) who
     are named as directors in the Company's articles of incorporation or who
     are nominated by, or for whose election proxies shall have been solicited
     by, the Board, or (ii) who are then serving as directors appointed by the
     Board to fill vacancies on the Board caused by death or resignation (but
     not by removal) or to fill newly-created directorships, the Committee, in
     its sole discretion, and without the consent of the holder of any option
     affected thereby, may determine that some or all outstanding options shall
     be cancelled as of the effective date of any such Change in Control and
     that the holder or holders of such cancelled options shall receive, with
     respect to some or all of the Common Shares subject to such options, as of
     the date of such cancellation, cash in an amount, for each Share subject to
     such options, equal to the excess of the per Share Fair Market Value of
     such Shares immediately prior to such Change in Control of the Company over
     the exercise price per Share of such options.

          (d)  Limitation on Change in Control Payments.  Notwithstanding
     anything in subparagraph 11(b) or 11(c) above or paragraph 12 below to the
     contrary, if, with respect to an optionee, the acceleration of the
     exercisability of an option or the payment of cash in exchange for all or
     part of an option as provided in subparagraph 11(b) or 11(c) above or
     paragraph 12 (which acceleration or payment could be deemed a "payment"
     within the meaning of Section 280G(b)(2) of the Code), together with any
     other payments which such optionee has the right to receive from the
     Company or any corporation which is a member of an "affiliated group" (as
     defined in Section 1504(a) of the Code without regard to Section 1504(b) of
     the Code) of which the Company is a member, would constitute a "parachute
     payment" (as defined in Section 280G(b)(2) of the Code), then such
     acceleration of exercisability and payments pursuant to subparagraph 11(b)
     or 11(c) above or paragraph 12 shall be reduced to the largest amount as,
     in the sole judgment of the Committee, will result in no portion of such
     payments being subject to the excise tax imposed by Section 4999 of the
     Code.

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  12.  DISSOLUTION, LIQUIDATION, MERGER.  In the event of (a) the proposed
dissolution or liquidation of the Company, (b) a proposed sale of substantially
all of the assets of the Company or (c) a proposed merger, consolidation of the
Company with or into any other entity, regardless of whether the Company is the
surviving corporation, or a proposed statutory share exchange with any other
entity (on the actual effective date of the dissolution, liquidation, sale,
merger, consolidation or exchange, each such occurrence being an "Event"), the
Committee may, but shall not be obligated to, either (i) if the Event is a
merger, consolidation or statutory share exchange, make appropriate provision
for the protection of outstanding options granted under this Plan by the
substitution, in lieu of such options, of options to purchase appropriate voting
common stock (the "Survivor's Stock") of the corporation surviving any such
merger or consolidation or, if appropriate, the parent corporation of the
Company or such surviving corporation, or, alternatively, by the delivery of a
number of shares of the Survivor's Stock which has a Fair Market Value as of the
effective date of such merger, consolidation or statutory share exchange equal
to the product of (x) the excess of (A) the Event Proceeds per Share (as
hereinafter defined) covered by the option as of such effective date over (B)
the exercise price per Share of the Shares subject to such option, times (y) the
number of Shares covered by such option or (ii) declare, at least twenty days
prior to the Event, and provide written notice to each optionee of the
declaration, that each outstanding option, whether or not then exercisable,
shall be cancelled at the time of, or immediately prior to the occurrence of,
the Event (unless it shall have been exercised prior to the occurrence of the
Event).  In connection with any declaration pursuant to clause (ii) of the
preceding sentence, the Committee may, but shall not be obligated to, cause
payment to be made, within twenty days after the Event, in exchange for each
cancelled option to each holder of an option that is cancelled, of cash equal to
the amount (if any), for each Share covered by the cancelled option, by which
the Event Proceeds per Share (as hereinafter defined) exceeds the exercise price
per Share covered by such option.  At the time of, or at such later time
provided in, any declaration pursuant to clause (ii) of the first sentence of
this paragraph 12, each option that has not previously expired pursuant to
subparagraph 5(d)(i) or 5(d)(ii) of this Plan shall immediately become
exercisable in full and each holder of an option shall have the right, during
the period preceding the time of cancellation of the option, to exercise his or
her option as to all or any part of the Shares covered thereby; provided,
however, that if such proposed dissolution, liquidation, sale, merger,
consolidation or exchange does not become effective, then the declaration
pursuant to clause (ii) of the first sentence of this paragraph 12 relating
thereto shall be rescinded, the acceleration of the exercisability of options
pursuant to the preceding clause shall be void, and each option that has not
previously expired pursuant to subparagraph 5(d)(i) or 5(d)(ii) of this Plan
shall be exercisable in accordance with its original terms.  In the event of a
declaration pursuant to clause (ii) of the first sentence of this paragraph 12,
each outstanding option granted pursuant to this Plan that shall not have been
exercised prior to the Event shall be cancelled at the time of, or immediately
prior to, the Event, as provided in the declaration, and this Plan shall
terminate at the time of such cancellation, subject to the payment obligations
of the Company provided in this paragraph 12.  Notwithstanding the foregoing, no
person holding an option 

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shall be entitled to the payment provided in this paragraph 12 if such option
shall have expired pursuant to subparagraph 5(d)(i) or 5(d)(ii) of this Plan.
For purposes of this paragraph 12, "Event Proceeds per Share" shall mean the
cash plus the fair market value, as determined in good faith by the Committee,
of the non-cash consideration to be received per Share by the shareholders of
the Company upon the occurrence of the Event.

  13.  ADJUSTMENTS.  In the event of any reorganization, merger, consolidation,
recapitalization, liquidation, reclassification, stock dividend, stock split,
combination of shares, rights offering, or extraordinary dividend or divestiture
(including a spin-off), or any other change in the corporate structure or Shares
of the Company, the Committee (or if the Company does not survive any such
transaction, a comparable committee of the Board of Directors of the surviving
corporation) may, without the consent of any optionee, make such adjustment as
it determines in its discretion to be appropriate as to the number and kind of
securities subject to and reserved under this Plan and, in order to prevent
dilution or enlargement of rights of participants in this Plan, the number and
kind of securities issuable upon exercise of outstanding options and the
exercise price thereof.

  14.  SUBSTITUTE OPTIONS.  Options may be granted under this Plan from time to
time in substitution for stock options held by employees of other corporations
who are about to become Associates, or whose employer is about to become a
subsidiary of the Company, as the result of a merger or consolidation of the
Company or a subsidiary of the Company with another corporation, the acquisition
by the Company or a subsidiary of the Company of all or substantially all the
assets of another corporation or the acquisition by the Company or a subsidiary
of the Company of at least 50% of the issued and outstanding stock of another
corporation.  The terms and conditions of the substitute options so granted may
vary from the terms and conditions set forth in this Plan to such extent as the
Board at the time of the grant may deem appropriate to conform, in whole or in
part, to the provisions of the stock options in substitution for which they are
granted.

  15.  COMPLIANCE WITH LEGAL REQUIREMENTS.

          (a)  General.  No certificate for Shares distributable under this Plan
     shall be issued and delivered unless the issuance of such certificate
     complies with all applicable legal requirements including, without
     limitation, compliance with the provisions of applicable state securities
     laws, the Securities Act of 1933, as amended, and the Exchange Act.

          (b)  Rule 16b-3.  With respect to Section 16 Individuals, transactions
     under this Plan are intended to comply with all applicable conditions of
     Rule 16b-3 or its successors under the Exchange Act. To the extent any
     provision of this Plan or action by the Committee fails to so comply, it
     shall be deemed null and void, to the extent permitted by law and deemed
     advisable by the Committee.

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  16.  GOVERNING LAW.  To the extent that federal laws do not otherwise control,
this Plan and all determinations made and actions taken under this Plan shall be
governed by the laws of the State of Minnesota and construed accordingly.

  17.  AMENDMENT AND DISCONTINUANCE OF PLAN.  The Board may at any time amend,
suspend or discontinue this Plan; provided, however, that no amendment to this
Plan shall, without the consent of the holder of the option, alter or impair any
option previously granted under this Plan.  To the extent considered necessary
to comply with applicable provisions of the Code, any such amendments to this
Plan may be made subject to approval by the shareholders of the Company.

  18.  TERM.

          (a) Effective Date.  This Plan shall be effective as of January 28,
     1998.

          (b)  Termination.  This Plan shall remain in effect until all Shares
     subject to it are distributed or this Plan is terminated under paragraph 17
     above.

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