The service was facing a July 28 midnight PDT deadline for shutting down after a lower court judge sided with the recording industry, which claimed Napster allowed users to violate copyrights.

Napster employees screamed jubilantly at hearing Friday’s news from a two-judge panel of the 9th U.S. Circuit Court of Appeals, a company spokeswoman said.

Before the stay, tens of thousands of outraged Napster users had pledged to boycott the recording industry in retaliation for its lawsuit, and looked for alternative free music-sharing programs.

“The recording industry is a mafia,”‘ said Christian Viveros, a 37-year-old amateur musician from Russells Point, Ohio, encountered in a Napster chat room. “Too much greed in the world.”

On one Web site, more than 60,000 people had signed an electronic petition vowing not to buy music unless the Recording Industry Association of America dropped its lawsuit against Napster. That would cost the industry nearly $1 million if each of those people refused to buy just one $15 CD.

Napster, founded last year by a Northeastern University student, contends that it is an Internet service provider and not responsible for the actions of its users. The company characterized Wednesday’s injunction that it shut down as a death sentence.

The industry responded by telling the 9th Circuit that giving Napster an 11th-hour reprieve would “increase dramatically” the harm it has suffered from “massive copyright infringement.”

With the deadline looming Friday, Napster’s Web site advertised a “Buy-Cott,” urging users to purchase CDs this weekend by artists who have embraced the file-sharing phenomenon,including Limp Bizkit, Chuck D and Marianne Faithful.

Users worldwide also held Napster-download marathons, and developers of alternatives to Napster’s distribution system worked feverishly to provide their software to people hooked onInternet music trading. Napster says it has 20 million patrons.

“We’re trying to give the people what they’ve been looking for,” said Dale “Diego” Hayes, a developer of AudioGnome, a Napster clone originally scheduled to be released in a few weeks. The work was accelerated after the order that Napster be turned off.

The Audio Gnome program is designed to do everything Napster does and more, said Hayes, a 34-year-old Californian who runs a United Kingdom-based Web site called Naphoria.

But instead of relying on a centrally located batch of computer servers like Napster, AudioGnome will rely on some 70 independent servers running a free program called OpenNap. Those servers are located mostly in the United States but also in Britain, Canada, Italy and other countries.

Hayes said they have doubled in number in the past few weeks and he expects them to keep multiplying in a post-Napster world.

“The reason Napster is being attacked is because it has servers,” Hayes said. “We don’t have any so I’m not worried about legal complications.”

Adam Mead, a 24-year-old systems manager, has an OpenNap server he’s been running for more than three months in Albuquerque, N.M. He was expecting traffic to skyrocket on Saturday if Napster had to close.

“If they serve me with legal documents requesting me to shut down or they’re going to sue me, I’ll shut it down,” he said. “I don’t have a million dollars.”