Apparatus and method are provided for indicating when a predetermined amount of tension has been applied to a band by a banding tool. The apparatus includes a housing, a lever for transferring pressure, and a tension indicator. As a tool handle is rotated to apply tension to a band, pressure is applied to the lever. When the tension applied is substantially equal to the predetermined tension, the lever pivots and activates the indicator, indicating to the operator of the banding tool that sufficient tension has been applied. In one embodiment, the indicator extends into the path of the rotating tool handle, thus preventing the operator from applying further tension to the band.