Weavers’ success tests the cultural fabric : They traded welfare for wool, and a brighter future--but one laced with uncertainties.

In the back room of a 140-year-old trading post in this mountain hamlet, Johanna Terrazas sits at a creaky loom weaving bright striped blankets out of dyed wool from nearly extinct churro sheep.

“You know, the old folks had it right,” said Terrazas, 39, admiring the snow-draped pasturelands. “We don’t need luxuries. What we need is family, land and a chance to make an honest living.”

Terrazas is one of nearly two dozen women in this impoverished village of 150 residents who learned traditional weaving techniques under the guidance of a nonprofit agricultural cooperative.

With their blankets, rugs and jackets growing in demand--and commanding higher prices--the women recently broke away from the cooperative, and their Tierra Wools subsidiary became employee-owned and operated.

But the separation was stressful and the future uncertain. At stake is a chance to become self-sufficient and to strengthen ties between the landowning and sheep-ranching families with roots going back to the Spanish conquest.

“Many times I’ve broken down and cried,” said 33-year-old Sophia Chavez, production manager for Tierra Wools. “Letting go of the past and planning for the future of the business is scary.”

“But it’s going to work out,” she said. “We won’t let it die. We’ve come too far to let that happen.”

Obstacles abound. For one thing, the market for Latino arts and crafts in general, and traditional weavings in particular, is being eroded by inexpensive knockoffs produced overseas. And the women have found it hard to devote full days at their looms without sacrificing family and ranch obligations.

Then there are developers posting “no trespassing” signs in the mountains framing the village, and environmentalists trying to stop grazing on public land even as the sheep ranches that supply Tierra Wools are striving to expand.

“Land abuse exposes a weakness in the cultural web,” said John Horning, a spokesman for Forest Guardians, a Santa Fe environmental group that has filed a lawsuit in federal court to stop the practice it believes is decimating grass and wildlife. “We’re not willing to abandon an environmental standard simply because there are complex cultural issues woven into the fabric.”

Sheep rancher Rosendo Serrano and his wife, Angie, who is a weaver at Tierra Wools, stiffen when they hear that kind of talk.

“If I can’t graze on public lands I’ll lose my sheep, the weavers will run out of wool and we’ll all be back on welfare,” Rosendo said, tossing handfuls of hay to sheep browsing behind his modest home. “But that isn’t going to happen. Our Lady of Guadalupe is the boss around here, and she is on our side.”

The mission of the 14-year-old cooperative was to revitalize the local economy by resurrecting traditional enterprises. In the process, the women would bind themselves to the land while weaving an industry of sheep growers, dyers, weavers, finishers, and sales and marketing people.

In 1983, when the women were students of the old textile science, Tierra Wools had sales of $14,000. These days, sales near $300,000 and the women have been emboldened by prestigious showings at galleries from Santa Fe to the Smithsonian Institution.

But their supply does not equal demand, and they need to employ more weavers. Hoping to increase their work force, the group has started offering classes.

Mending knots in a blanket she designed and wove herself, 50-year-old Ernestine Aragon said: “I’m divorced with two kids and no child support--everything I have depends on this job.”

“This blanket will sell for about $800,” said Aragon, who earns about $7,000 a year. “I’ll get $300 out of that, plus a bonus. The rest goes back into the business.

“I know it’s not much money,” she added. “But all of my blankets have tags with my picture on them.”

“If it had been about money we wouldn’t have gotten this far,” said Molly Manzanares, a Tierra Wools spokeswoman. “It’s all about pride and accomplishment. It’s about doing something for ourselves, our children, our community.”

For Rachel Brown, a master weaver and Tierra Wools consultant, it is also an aesthetic triumph.

“When I first met them, they worked on primitive equipment in an old convent heated by a tiny wood stove,” Brown recalled. “Now, they have a perfect chance to make a huge dent in the world of weaving. They’re my heroes.”