Gin plant capacity utilization and operating costs covering the 1970/71 and 1971/72 seasons were analyzed for a sample of 27 gins representing over 13 percent of the total ginning capacity for the Blacklands of Texas. Average rates of capacity utilization were about the same both years for plants with hourly capacities up through 11 bales (groups 1-3) but dropped off rather sharply in the larger plants (group 4) during 1971/72. Costs per bale were higher in 1971/72, reflecting general price increases, an appreciable increase in average per bale labor costs for group 3, and an average volume decline for group 4. The weighted average total cost per bale was $23.37 for 1970/71 and $24.90 for 1971/72. It is estimated that this cost would have been lowered by $5.60 in 1970/71 and by $6.12 in 1971/72 if average rates of capacity utilization could have been raised to 70 percent for each of the 2 crop years.