Abstract: A wall mounted paper towel dispensing apparatus and an assembly for converting a cloth towel dispensing apparatus into a paper towel dispensing apparatus. A roll of toweling is carried in a towel bin from which the toweling is withdrawn and directed upwardly between a first drive roller and a pinch roller, about the pinch roller and downwardly, forming a depending loop from which the toweling is directed upwardly between a second drive roller and a take-up roller and is rolled about the take-up roller. As the user dries his hands on the loop of toweling and pulls downwardly on the toweling, a limited amount of clean paper toweling is pulled from the roll and an equal amount is wrapped about the take-up roller. The present invention provides both stronger and less expensive paper toweling for use in the dispensing apparatus and improved rollers, alignment and friction guides to direct the paper through the apparatus.