Prevent musty odors by storing your leather purse in a dry area. If they already set in, you can still get the musty smell out and restore it to its original rich scent.
Take your leather purse outside every day to soak up the fresh air and sun. Each day, the musty smell from your purse will dissipate until the odor is gone completely. Keep the purse open when it's outdoors to allow for interior ventilation.
Mix even amounts of warm water and rubbing alcohol into a bowl. Dip your cloth into the liquid, and wring out the excess. Wipe down the exterior of your leather purse with your cloth to get rid of the musty odor and to kill mold and mildew.
Place a few charcoal briquettes in your leather purse to absorb musty odors. Change out the charcoal every couple of days until the musty smell is gone. Charcoal can stain fabric, so place your briquettes on a piece of tissue or a paper towel.
Spray your leather purse with shoe freshening spray. These sprays are used to freshen and absorb odors from shoes and other leather goods. Lightly spray the outside of your purse with the shoe spray, and then take it outside to dry. Shoe sprays are available at leather goods stores, boot retailers and some shoe stores.
Pour baking soda into a bowl, and place it near your leather purse to absorb the musty smell. Baking soda neutralizes and absorbs odors from fabric and leather, like it does in the refrigerator. Replace baking soda every two days until the musty smell has dissipated.