This study investigates the structural change and reorganization of the weaving industry in Fukui, which has been caused by the change of demand and the strong yen since 1985. The vertical integration in the Fukui textile industry area was made by some shosya (trading companies) and large synthetic-fiber makers. Each weaver had dealings with customers and were divided into three interlocking groups, which were: large synthetic-fiber makers did business with large-sized textile companies ; kengai-shosya (trading companies outside the Fukui prefecture) did business with medium-sized textile companies; and sanmoto-shosya (trading companies in the Fukui textile industry area) did business with small-sized textile companies. Since 1985, we have had full-scale high quality diversification in textile demand. Due to the strong yen, the exporting situation became worse, and more imported products were coming in. Because of this situation, some textile companies introduced innovative looms to cut the cost of production. They also changed the way operation, from mass production of few kinds of products, to small scale production of many kinds of products, or from popular products to high quality products. As a result, the vertical integration somewhat changed. Textile companies are being reorganized into those with and without the ability to produce high quality products. Large-sized textile companies have dealings with the large synthetc-fiber makers and kengai-shosya, taking advantage of a great stock of technical skill and producing power. Medium-sized textile companies, which continue to produce high quality products, have dealings with kengai-shosya. While medium-sized textile companies, which still produce the popular products, have dealings with Sanmoto-Shosya, dropping out of dealings with kengai-shosya. Small-sized textile companies have dealings with Sanmoto-Shosya, most of them still producing the popular products. However, some of them try to specialize in a niche market. Therefore, textile companies in the Fukui textile industry area are divided into four groups, the medium-sized textile companies being divided into two groups, the kengai-shosya group and sanmoto-shosya group. Textile companies producing the popular products are either dropping out of the upper-rank-group, or discontinuing their businesses. On the other hand, textile companies producing the high quality products are becoming mainstream in the Fukui area. The Fukui textile industry-area is going through the process of reduction and reorganization as a whole.