A plastic or other film bag is formed from a continuous extruded tube. The tube is flattened and sealed across its width at intervals to form bag bottoms. The bags are joined to one another at a perforation line and folded in thirds lengthwise prior to being rolled into a compact roll, either with or without supporting core. After folding the bags may be chisel cut through the center of the perforation line to assist in dispensing of the bags. The chisel cut will extend through all layers of the bag when folded, resulting in three chisel cuts in the bag. The bags may be gusseted for part or as much as all of their width. The bags may also be corona treated and printed on their outer surfaces. The bags may be formed from partially recycled materials and various combinations of linear low density, medium and high density polyethylene.