FORNEY, March 4 (AP) - Two children were killed and property damage in excess of $100,000 was caused by a tornado which swept through Forney just before dawn Monday.

Practically every building in town was damaged to some extent, some of them being demolished.

Flimsy houses in the negro section were blown away. It was there that two negro children lost their lives in the ruins of their home.

HITS ROCKWALL

A white woman, Mrs. B.G. Edwards, was the only other casualty. She was injured but not seriously.

The tornado tore into Forney, a Kaufman county farming town of about 1,000 population, from the south and raced on northward, inflicting some damage at Rockwall 30 miles away. Two Rockwall drug stores were partially wrecked.

The path of the tornado was marked by the debris of barns and outhouses, twisted trees, leveled crops and torn communication lines.

In Forney, two huge cotton warehouses were demolished, the East Texas Cotton Oil company's mill was damaged to the extent of about $10,000, the Texas and Pacific depot was unroofed and otherwise badley damaged, the back end of the Knights of Pythias hall was blown in and downstairs in the same building the Anderson-Clayton undertaking establishment was wrecked.

COMMUNICATIONS OUT

There were unconfirmed reports that rural residents in the path of the tornado had been injured, but roads were impassable and communication lines were down, making it impossible to verify whether there were casualties outside of Forney.

"It didn't last two minutes - just hit and was gone," was the way B.B. Hulsey, manager of the East Texas Cotton Oil company, described the tornado, which hit town about 5 a.m.

He estimated that at least 100 homes were damaged, many of the weakly-constructed ones being torn down and blown away.