The most heartwarming story to come out of Fashion Week is taking place far across town from the posh tents at Bryant Park, in the slightly down-at-the-heels precincts of New York's East Village.

Up three flights of steep, bright red stairs in a converted firehouse, Natalie Chanin, founder of Alabama Chanin, is showing a beguiling collection of hand-made clothes to a select audience of buyers and Chanin groupies.

Chanin's label, formerly known as Project Alabama, is that rarity in the fashion biz -- a totally grown-to-sewn-in-the-USA line. In this case, the garments are crafted by a cadre of stitchery wizards in Chanin's tiny hometown of Florence, Alabama.

The clothes, which are all organic cottons, are lavished with quilting and embroidery techniques from the Depression-era South. Chanin, who was a finalist for the National Design Award for Fashion, based her company on the idea that good design should be part of everyday living, and that the artisanship of the past should be kept alive. To that end, stitchers in their early 20s work alongside those in their 70s, producing garments in the spirit of the traditional quilting bee.

Their appeal is primal. "People throughout the world have memories of some textile from our childhood," Chanin says, over fried chicken and potato salad at her show. "It might be a baby blanket, or a favorite item of clothing. So people respond to these clothes because they're handmade."

Despite their down-home DNA, these are hardly thrift shop garments. Chernin's line is available at such tony shops as Barney's, Bergdorf Goodman, and Harvey Nichols.

But in the bleak topography of current retail, where even the luxury labels are getting battered, Chanin's added layer of meaning is proving a potent force. "We haven't seen any effects of the recession," she says. "People who do have money now want to spend it on something with meaning."

Chanin's latest venture ramps that social entrepreneurship up another level. For her denim line, she's turned to Father Andrew, a young Catholic priest in the Bronx who is part of a venture called Goods of Conscience. He employs Guatemalan and El Salvadoran parishioners to dye indigo in the church's basement. "These clothes have the feeling of being old, but new, all at the same time."