This Prospectus Supplement is filed pursuant to Rule
424(b)(3) and relates to Registration Statement
No. 33-98800

PROSPECTUS SUPPLEMENT


                              PROSPECTUS SUPPLEMENT

                                  90,102 SHARES

                              RENTERS CHOICE, INC.

                                  COMMON STOCK

                          -----------------------------

      All of the 90,102 shares of common stock, par value $0.01 per share (the
"Common Stock"), of Renters Choice, Inc. (the "Company") offered hereby are
offered for the account of the stockholders described herein (the "Selling
Stockholders"). See "Selling Stockholders." The shares to be offered are those
acquired by the Selling Stockholders pursuant to the 1994 Renters Choice, Inc.
Long-Term Incentive Plan (the "Plan"). The 90,102 shares of Common Stock offered
hereby are referred to herein as the "Selling Stockholder Shares."

      The Selling Stockholders may offer the Selling Stockholder Shares offered
hereby from time to time to purchasers directly or through agents, underwriters
or dealers. Such shares may be sold at market prices prevailing at the time of
sale or at negotiated prices. See "Plan of Distribution." The Common Stock is
traded on the Nasdaq National Market under the symbol RCII. On November 18,
1996, the last sale price for the Common Stock was $20.50 per share. The Company
will not receive any proceeds from the sale of Selling Stockholder Shares. See
"Use of Proceeds." 

                         ------------------------------

             THE COMMON STOCK OFFERED HEREBY INVOLVES CERTAIN RISKS.
                 SEE "RISK FACTORS" BEGINNING ON PAGE 4 OF THIS
                             PROSPECTUS SUPPLEMENT.

                         -------------------------------

          THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
           SECURITIES AND EXCHANGE COMMISSION, NOR HAS THE COMMISSION
            PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS.
            ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.

                         -------------------------------

                                November 19, 1996

      No dealer, salesperson or other person has been authorized to give any
information or to make any representation not contained or incorporated by
reference in this Prospectus, and, if given or made, such information or
representation must not be relied upon as having been authorized by the Company
or the Selling Stockholders. This Prospectus does not constitute an offer to
sell or a solicitation of an offer to buy any securities other than the shares
of Common Stock offered by this Prospectus, or an offer to sell or a
solicitation of an offer to buy the shares of Common Stock in any jurisdiction
to any person to whom it is unlawful to make such offer or solicitation in such
jurisdiction. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create any implication that there has
been no change in the affairs of the Company since the date hereof or that the
information contained herein is correct as of any time subsequent to the date
hereof.

                             AVAILABLE INFORMATION

      The Company is subject to the informational requirements of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and in accordance
therewith files reports, proxy and information statements and other information
with the Securities and Exchange Commission (the "Commission"). Such reports,
proxy and information statements and other information filed by the Company with
the Commission may be inspected and copied at the public reference facilities
maintained by the Commission at Room 1024, Judiciary Plaza, 450 Fifth Street,
N.W., Washington, D.C. 20549, at its New York Regional Office, 7 World Trade
Center, 13th Floor, New York, New York 10048, and at its Chicago Regional
Office, Citicorp Center, 500 West Madison Street, Suite 1400, Chicago, Illinois
60661-2511. The Commission also maintains a Web site at http://www.sec.gov which
contains reports, proxy and information statements and other information
regarding the Company.

      The Company has filed with the Commission in Washington, D.C. a
Registration Statement under the Securities Act with respect to the shares of
Common Stock offered hereby. This Prospectus does not contain all of the
information set forth in the Registration Statement and the exhibits thereto.
For further information with respect to the Company and the Common Stock,
reference is made to such Registration Statement and exhibits, copies of which
may be obtained from the Commission.

                INCORPORATION OF CERTAIN DOCUMENTS BY REFERENCE

      The Company hereby incorporates by reference into this Prospectus: (i) the
reports listed below (which include all reports filed by the Company with the
Commission pursuant to Sections 13(a) or 15(d) of the Exchange Act since January
1, 1996); and (ii) the description of the Common Stock contained in the
Company's registration statement on Form 8-A under the Exchange Act
(Registration No. 0-25370) filed by the Company with the Commission, including
any amendments or reports filed for the purpose of updating such description:

                                     -2-

                       REPORTS INCORPORATED BY REFERENCE

      1.    Annual Report on Form 10-K for the fiscal year ended December 31,
            1995;

      2.    Quarterly Report on Form 10-Q for the fiscal quarter ended March 31,
            1996;

      3.    Quarterly Report on Form 10-Q for the fiscal quarter ended June 30,
            1996;

      4.    Quarterly Report on Form 10-Q for the fiscal quarter ended September
            30, 1996; and

      5.    Current Report on Form 8-K dated May 15, 1996, as amended by two
            Forms 8-K/A.

      In addition, all documents filed by the Company subsequent to the date
hereof pursuant to Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act but
prior to the termination of the offering of the shares of Common Stock offered
hereby shall be deemed to be incorporated by reference into this Prospectus and
to be a part hereof from the date of the filing of such documents. Any statement
contained herein or in a document incorporated or deemed to be incorporated by
reference herein shall be deemed to be modified or superseded for purposes of
this Prospectus to the extent that a statement contained in any other
subsequently filed document which also is incorporated or deemed to be
incorporated by reference herein modifies or supersedes such statement. Any such
statement so modified or superseded shall not be deemed, except as so modified
or superseded, to constitute a part of this Prospectus.

      The Company will provide without charge to each person, including any
beneficial owner, to whom a copy of this Prospectus is delivered, upon the
written or oral request of such person, a copy of any and all of the information
incorporated herein by reference (not including exhibits to the information that
is incorporated by reference unless such exhibits are specifically incorporated
by reference into the information that this Prospectus incorporates). Requests
for such copies should be directed to: Mr. Randall Simpson, Renters Choice,
Inc., 13800 Montfort Drive, Suite 300, Dallas, Texas 75240.

                                     -3-

                                 RISK FACTORS

      PROSPECTIVE INVESTORS SHOULD CAREFULLY CONSIDER THE FOLLOWING FACTORS,
TOGETHER WITH THE OTHER INFORMATION SET FORTH ELSEWHERE IN THIS PROSPECTUS,
PRIOR TO PURCHASING ANY SHARES OF COMMON STOCK OFFERED HEREBY.

ACQUISITION CONSIDERATIONS

      As a result of certain acquisitions made by the Company in 1995 and 1996,
the Company materially increased the scope of its operations from 114 stores in
17 states (and Puerto Rico) in January 1995 to 405 stores in 33 states (and
Puerto Rico) at November 18, 1996. In addition, in May 1996, the Company
acquired ColorTyme, Inc., a national franchisor of 306 rent-to-own stores in 38
states. There can be no assurance that the acquired operations will perform in
accordance with management's expectations or that the Company will not encounter
unanticipated problems or liabilities in connection with the acquired
operations.

      The continued growth and financial performance of the Company will depend,
in part, on the Company's ability to acquire additional rent-to-own stores on
favorable terms, to enhance their performance and to integrate the acquired
stores into the Company's operations. The Company may compete for acquisition
and expansion opportunities with companies that have significantly greater
financial and other resources than the Company. There can be no assurance that
the Company will be able to locate or acquire suitable acquisition candidates,
or that any operations that are acquired can be effectively and profitably
integrated into the Company's existing operations. Additionally, acquisitions
may negatively impact the Company's operating results, particularly during the
periods immediately following an acquisition. The Company has historically
sought to acquire underperforming operations, and as a result the acquired
stores generally have experienced more significant revenue growth during the
initial periods following their acquisition than in subsequent periods. In the
future, the Company may acquire operations that prove to be unprofitable or have
inconsistent profitability. The inability to improve the profitability of such
acquired stores could have a material adverse effect on the Company's results of
operations and financial condition. Furthermore, the Company's acquisition
strategy is likely to place significant demands on the Company's management and
financial resources.

GOVERNMENT REGULATION

      There are currently three states in which the Company operates that have
legislation regulating rental purchase transactions as credit sales subject to
interest rate limitations and other consumer lending restrictions. This type of
regulation causes certain rental payments, or portions thereof, to be
characterized as interest and, therefore, subject to state usury law
limitations. The Company is not aware that any similar legislation is pending or
proposed in any other state. However, the enactment of this type of legislation
in additional states or at the federal level could have a material adverse
effect on the Company's results of operations.

                                     -4-

DEPENDENCE UPON KEY PERSONNEL

      The success of the Company's business is highly dependent upon the
personal efforts and abilities of its senior management, including J.E. Talley,
its Chairman of the Board and Chief Executive Officer, Mark E. Speese, its
President and Chief Operating Officer, and L. Dowell Arnette, its Executive Vice
President. The Company does not have employment contracts or noncompetition
agreements with any of these executive officers. The loss of the services of any
of Mr. Talley, Mr. Speese or Mr. Arnette could have a material adverse effect on
the Company's results of operations.

COMPETITION

      The rent-to-own industry is highly competitive. Competition is based
primarily on store location, product selection and availability, customer
service and rental rates and terms. Several of the Company's competitors operate
on a national or regional basis and some have significantly greater financial
and operating resources and name recognition than the Company. In addition, the
Company faces competition from sources outside the rent-to-own industry, such as
department stores, discount stores and those rental stores offering short-term
rent-to-rent arrangements. Because barriers to entry in the rent-to-own industry
are relatively low, competition may arise from new sources not currently
competing with the Company. As a result of these competitive conditions, the
Company may not be able to sustain past levels of revenue or continue its recent
revenue growth or profitability.

CONTROL BY PRINCIPAL STOCKHOLDERS

      As of November 18, 1996, J.E. Talley, Mark E. Speese and Michael C.
Talley, officers of the Company, owned approximately 24.7%, 11.1% and 4.7%,
respectively, of the Company's outstanding Common Stock. As a result, Messrs.
Talley, Speese and Talley, should they act in concert, will be in a position to
exercise practical control over the outcome of actions requiring stockholder
approval, including potential acquisitions, sales and changes in control of the
Company and elections for the Company's Board of Directors.

DIVIDEND POLICY

      The Company does not anticipate paying any dividends on its Common Stock
in the foreseeable future.

ANTI-TAKEOVER PROVISIONS

      The Company's Amended and Restated Certificate of Incorporation, as
amended, and Amended and Restated Bylaws contain, among other things, provisions
establishing a classified board of directors, authorizing the issuance of "blank
check" preferred stock and establishing advance notice requirements for director
nominations and actions to be taken at annual meetings. In addition, the Company
is subject to the provisions of Section 203 of the General Corporation Law of
the State of Delaware. Such provisions and arrangements could delay, deter or
prevent a merger, consolidation, tender offer or other business combination or
change of control

                                     -5-

involving the Company that some or a majority of the Company's stockholders
might consider to be in their best interests, including offers or attempted
takeovers that might otherwise result in such stockholders receiving a premium
over the market price for the Common Stock.

SHARES ELIGIBLE FOR FUTURE SALE

      No prediction can be made as to the effect, if any, that future sales of
shares of Common Stock, or the availability of such shares for future sale, will
have on the market price of the Common Stock prevailing from time to time. Sales
of substantial amounts of Common Stock (including shares issued upon the
exercise of employee stock options), or the perception that such sales could
occur, could adversely affect prevailing market prices for the Common Stock. As
of November 18, 1996, the Company had 24,824,585 shares of Common Stock
outstanding.

                                     -6-

                                USE OF PROCEEDS

      The Common Stock offered hereby is being registered for the account of the
Selling Stockholders and, accordingly, the Company will not receive any proceeds
from the sale of the Selling Stockholder Shares by the Selling Stockholders.

                             SELLING STOCKHOLDERS

      The Common Stock offered by this Prospectus has been or will be acquired
by the employees and directors of the Company named herein (the "Selling
Stockholders") pursuant to the 1994 Renters Choice, Inc. Long-Term Incentive
Plan (as amended, the "Plan"). Each Selling Stockholder will receive all of the
net proceeds from the sale of his respective Selling Stockholder Shares offered
hereby. Because (i) the Selling Stockholders may sell all or part of their
Selling Stockholder Shares pursuant to this Prospectus and (ii) the offering is
not being underwritten on a firm commitment basis, no information can be given
as to the amount and percentage of shares of Common Stock that will be held by
each Selling Stockholder upon termination of the offering covered by this
Prospectus. The following table sets forth, with respect to each Selling
Stockholder: (i) the name of the Selling Stockholder; (ii) the nature of any
position, office or other material relationship which such Selling Stockholder
has had within the past three years with the Company or any of its affiliates;
(iii) the number of shares of Common Stock owned by such Selling Stockholder as
of November 18, 1996; and (iv) the number of shares of each such Selling
Stockholder to be offered hereby.

                                         NUMBER OF SHARES OF
                                         COMMON STOCK OWNED
                                               AS OF           NUMBER OF SHARES
NAME AND POSITION                        NOVEMBER 18, 1996(1)   OFFERED HEREBY
- -----------------                        --------------------   --------------
J.V. Lentell, Director ......................    12,000          12,000

Joseph V. Mariner, Director .................     6,602           6,602

Rex W. Thompson, Director ...................    12,000          12,000

L. Dowell Arnette, Executive Vice President .   438,664           3,750

David D. Real, Senior VicePresident --
  Finance and Chief Financial Officer .......    25,000          25,000

Douglas Balduini, Regional Vice President ...    35,120           2,500

Christopher R. Dement, Regional
  Vice President ............................    25,798(2)        3,750

Dana Goble, Regional Vice President .........    14,626           3,750

William Nutt, Regional Vice President .......    13,376           2,500

Michael C. Talley, Regional Vice President .. 1,168,650(2)        3,750

John Velez, Regional Vice President .........     2,500           2,500

John D. Whitehead, Regional Vice President ..    14,626           3,750

                                       -7-

David Kraemer, Regional Vice President ......     1,250           1,250
                                                  
Thomas Lopez, Regional Vice President .......     1,250           1,250
                                                  
John Spangle, Regional Vice President .......     1,250           1,250
                                                  
Tony Doll, Regional Vice President ..........     1,875           1,875
                                                  
Joe T. Arnette, Vice President - Training and     
Personnel ...................................     1,875           1,875
                                                  
David M. Glasgow, Secretary/Treasurer .......       750             750
- ------------                                              
(1)   Includes shares issuable upon the exercise of options exercisable within
      60 days of this Prospectus which are reflected in the column representing
      the number of shares offered by this Prospectus.

(2)   Includes shares held by the individual as trustee for various trusts.

                                     -8-

                             PLAN OF DISTRIBUTION

      The Selling Stockholder Shares may be sold from time to time by the
Selling Stockholders, or by pledgees, donees, transferees or other successors in
interest. Such sales may be made on the Nasdaq National Market or any exchange
on which the Common Stock is traded, in the over-the-counter market, or
otherwise at prices and at terms then prevailing or at prices related to the
then current market price, or in negotiated transactions. The Selling
Stockholder Shares may be sold in one or more of the following transactions: (a)
a block trade in which the broker or dealer so engaged will attempt to sell the
Selling Stockholder Shares as agent but may position and resell a portion of the
block as principal to facilitate the transaction; (b) purchases by a broker or
dealer as principal and resale by the broker or dealer for its account pursuant
to this Prospectus; (c) an exchange distribution in accordance with the rules of
the exchange; and (d) ordinary brokerage transactions and transactions in which
the broker solicits purchasers. In effecting sales, brokers or dealers engaged
by the Selling Stockholders may arrange for other brokers or dealers to
participate. Any broker or dealer to be utilized by a Selling Stockholder will
be selected by such Selling Stockholder. Brokers or dealers will receive
commissions or discounts from Selling Stockholders in amounts to be negotiated
immediately prior to the sale. These brokers or dealers and any other
participating brokers or dealers, as well as certain pledgees, donees,
transferees and other successors in interest, may be deemed to be "underwriters"
within the meaning of Section 2(11) of the Securities Act in connection with the
sales. In addition, any securities covered by this Prospectus that qualify for
sale pursuant to Rule 144 under the Securities Act may be sold under Rule 144
rather than pursuant to this Prospectus.

      Upon the Company being notified by a Selling Stockholder that any material
arrangement has been entered into with a broker-dealer for the sale of Selling
Stockholder Shares through a block trade, special offering, exchange
distribution or secondary distribution or a purchase by a broker or dealer, a
supplemental prospectus will be filed, if required, pursuant to Rule 424(c)
under the Securities Act, disclosing (i) the name of each such Selling
Stockholder and of the participating broker-dealer(s), (ii) the number of
Selling Stockholder Shares involved, (iii) the price at which such Selling
Stockholder Shares were sold, (iv) the commissions paid or discounts or
concessions allowed to such broker-dealer(s), where applicable, (v) that such
broker-dealer(s) did not conduct any investigation to verify the information set
out or incorporated by reference in this Prospectus and (vi) other facts
material to the transaction.

      The Selling Stockholders reserve the sole right to accept and, together
with any agent of the Selling Stockholders, to reject in whole or in part any
proposed purchase of the Selling Stockholder Shares. The Selling Stockholders
will pay any sales commissions or other seller's compensation applicable to such
transactions.

      To the extent required, the amount of the Selling Stockholder Shares to be
sold, purchase prices, public offering prices, the names of any agents, dealers
or underwriters, and any applicable commissions or discounts with respect to a
particular offer will be set forth by the Company in a prospectus supplement
accompanying this Prospectus or, if appropriate, a post-effective amendment to
the Registration Statement. The Selling Stockholders and agents who execute
orders on their behalf may be deemed to be underwriters as that term is defined
in

                                     -9-

Section 2(11) of the Securities Act and a portion of any proceeds of sales and
discounts, commissions or other seller's compensation may be deemed to be
underwriting compensation for purposes of the Securities Act.

      Offers or sales of the Common Shares have not been registered or qualified
under the laws of any country, other than the United States. To comply with
certain states' securities laws, if applicable, the Selling Stockholder Shares
will be offered or sold in such jurisdictions only through registered or
licensed brokers or dealers. In addition, in certain states the Selling
Stockholder Shares may not be offered or sold unless they have been registered
or qualified for sale in such states or an exemption from registration or
qualification is available and is complied with.

      Under applicable rules and regulations under the Exchange Act, any person
engaged in a distribution of the Common Stock may not simultaneously engage in
market-making activities with respect to such Common Stock for a period of two
to nine business days prior to the commencement of such distribution. In
addition to and without limiting the foregoing, each Selling Stockholder and any
other person participating in a distribution will be subject to applicable
provisions of the Exchange Act and the rules and regulations thereunder,
including without limitation, Rules 10b-2, 10b-6 and 10b-7, which provisions may
limit the timing of purchases and sales of any shares of the Common Stock by the
Selling Stockholders or any such other person. All of the foregoing may affect
the marketability of the Common Stock and the brokers' and dealers' ability to
engage in market-making activities with respect to the Common Stock.

      The Company will pay substantially all of the expenses incident to the
registration of the Selling Stockholder Shares, estimated to be approximately
$30,000.

                                LEGAL MATTERS

      Certain legal matters will be passed upon for the Company by Winstead
Sechrest & Minick P.C., Dallas, Texas.

                                    EXPERTS

      The financial statements and related schedules of the Company, included in
the Company's Annual Report on Form 10-K for the year ended December 31, 1995
and incorporated by reference in this Prospectus and Registration Statement have
been audited by Grant Thornton LLP, independent certified public accountants.
Such financial statements and related schedules are, and audited financial
statements and schedules to be included in subsequently filed documents will be,
incorporated herein in reliance upon the report of Grant Thornton LLP (to the
extent covered by a consent filed with the Securities and Exchange Commission)
given upon the authority of such firm as an expert in accounting and auditing.

                                     -10-

                         INDEMNIFICATION OF DIRECTORS

      The Company's Amended and Restated Certificate of Incorporation, as
amended, provides that the Company shall, to the fullest extent permitted by the
DGCL or other applicable law, as the same may be amended, supplemented and
replaced from time to time, indemnify any and all past, present and future
directors and officers of the Company from and against any and all costs,
expenses (including attorneys' fees), damages, judgments, penalties, fines,
punitive damages, excise taxes assessed with respect to an employee benefit plan
and amounts paid in settlement in connection with any action, suit or
proceeding, whether by or in the right of the Company, a class of its security
holders or otherwise, by reason of the fact that such person was serving as a
director, officer, employee or agent of the Company.

      The Company has entered into Indemnification Agreements pursuant to which
it will indemnify certain of its directors and officers against judgments,
claims, damages, losses and expenses incurred as a result of the fact that any
director or officer, in his capacity as such, is made or threatened to be made a
party to any suit or proceeding. Such person will be indemnified to the fullest
extent now or hereafter permitted by the DGCL. The Indemnification Agreements
also provide for the advancement of certain expenses to such directors and
officers in connection with any such suit or proceeding.

      Insofar as indemnification for liabilities under the Securities Act of
1933, as amended, may be permitted to directors, officers or persons controlling
the Company pursuant to the foregoing provisions, the Company has been informed
that in the opinion of the Securities and Exchange Commission such
indemnification is against public policy as expressed in the Securities Act of
1933 and is therefore unenforceable.

                                     -11-

================================================================================

No person has been authorized to give any information or to make any
representations other than those contained herein and, if given or made, such
information or representations must not be relied upon as having been authorized
by the Company or the Selling Stockholders. This Prospectus does not constitute
an offer to sell, or a solicitation of an offer to buy, the securities offered
hereby in any jurisdiction to any person to whom it is unlawful to make an offer
or solicitation. Neither the delivery of this Prospectus nor any sale made
hereunder shall, under any circumstances, create an implication that there has
not been any change in the facts set forth in this Prospectus or in the affairs
of the Company since the date hereof.

                                 ---------------
                                               
                                TABLE OF CONTENTS
                                               
                                                          PAGE        
                                                          ----
                   PROSPECTUS SUPPLEMENT

                   Available Information ...............    2
                   Incorporation of Certain Documents by
                      Reference ........................    2
                   Risk Factors ........................    4
                   Use of Proceeds .....................    7
                   Selling Stockholders ................    7
                   Plan of Distribution ................    9
                   Legal Matters .......................   10
                   Experts .............................   10
                   Indemnification of Directors ........   11

================================================================================

                                 90,102 SHARES

                              RENTERS CHOICE, INC.

                                  COMMON STOCK

                                 ______________
                        
                              PROSPECTUS SUPPLEMENT
                                 ______________
                        
                        
                                November 19, 1996

                                      -12-