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 *
MARGOLIS ROBERT
   2. Issuer Name and Ticker or Trading Symbol
CHEROKEE INC [CHKE] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
__X__ Director __X__ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Executive Chairman (1)
(Last)
(First)
(Middle)
6835 VALJEAN AVE		 3. Date of Earliest Transaction (Month/Day/Year)
01/28/2011
(Street)

VAN NUYS, CA 91406		 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
Common Stock               743,087 D  
Common Stock               135,000 I By Newstar Group, dba The Wilstar Group
Common Stock 01/28/2011 01/28/2011 S   60,000 D $ 18.15 683,087 D  
Common Stock 01/28/2011 01/28/2011 D   400,000 D $ 18.15 283,087 D  

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
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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
Common Stock Options $ 18.49             01/28/2011 06/04/2015 Common Stock 50,000   50,000 D  
Common Stock Options $ 18.49             01/28/2011 06/04/2015 Common Stock 50,000   100,000 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
MARGOLIS ROBERT
6835 VALJEAN AVE
VAN NUYS, CA 91406		   X   X   Executive Chairman (1)  

Signatures

 Mark DiSiena under POA for Robert Margolis   02/01/2011
**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).
 
Remarks:
(1)
As previously reported on Cherokee Inc.'s Current Report on Form 8-K, which was filed with the Securities and Exchange Commission on January 31, 2011, on January 28, 2011 (the "Resignation Date"), Robert Margolis resigned his positions as Executive Chairman and as a director of Cherokee. In connection with Mr. Margolis' resignation from Cherokee, Mr. Margolis and Cherokee entered into a Separation Agreement and General Release of all Claims (the "Separation Agreement"), dated January 28, 2011. Mr. Margolis will have until February 4, 2011 to revoke the Separation Agreement. In the event that Mr. Margolis does not exercise his right to revoke the Separation Agreement, the Separation Agreement will become effective on February 5, 2011 (the "Effective Date").

On the Effective Date, Cherokee will repurchase from Mr. Margolis 400,000 shares of Cherokee's Common Stock at a price per share of $18.15, which was the closing price of Cherokee's Common Stock on the Resignation Date, for aggregate proceeds of $7,260,000.  Cherokee will acquire such shares from Mr. Margolis in consideration for the issuance by Cherokee to Mr. Margolis of a promissory note.  In addition, on the Effective Date, Cherokee's Chairman, Mr. Jess Ravich, and Cherokee's Chief Executive Officer, Mr. Henry Stupp, will purchase 50,000 and 10,000 shares of Cherokee's Common Stock, respectively, from Mr. Margolis at the same per share price for cash consideration of $907,500 and $181,500, respectively.

In addition, pursuant to the Separation Agreement, Mr. Margolis' outstanding option to purchase up to 100,000 shares of Cherokee's Common Stock will become fully vested and exercisable.

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