Ownership Submission
FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934, Section 17(a) of the Public Utility Holding Company Act of 1935 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
GARRISON ROBERT E II
   2. Issuer Name and Ticker or Trading Symbol
TERAFORCE TECHNOLOGY CORP [TERA] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director _____ 10% Owner
_____ Officer (give title below) _____ Other (specify below)
(Last)
(First)
(Middle)
600 TRAVIS, SUITE 3000		 3. Date of Earliest Transaction (Month/Day/Year)
01/28/2005
(Street)

HOUSTON, TX 77002		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price

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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
warrant (1) $ 0.17 01/28/2005 01/28/2005 J   1,250,000   01/28/2005 01/31/2011 Common Stock par value $0.01 1,250,000 $ 0.17 1,250,000 D  
conversion right (1) $ 0.16 01/28/2005 01/28/2005 J   625,000   01/28/2005 07/31/2005 Common Stock par value $0.01 625,000 $ 100,000 625,000 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
GARRISON ROBERT E II
600 TRAVIS
SUITE 3000
HOUSTON, TX 77002		   X      

Signatures

 /s/ Robert E. Garrison II   01/28/2005
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) Mr. Garrison has provided a guaranty in the amount of $550,000 as partial security for a $550,000 bank credit facility entered into by the Company on January 28, 2004. Pursuant to a Reimbursement Agreement related to this guaranty, Mr. Garrison has the right to acquire 625,000 shares of common stock for $100,000 in cash. The proceeds of this purchase must be used by the Company to retire amounts outstanding under the bank credit agreement and to obtain the release of the guaranty. In addition, Mr. Garrison has been issued warrants to purchase 1,250,000 shares of common stock. The warrants have an exercise price of $0.17 per share

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