Can cobblestone survive in the asphalt jungle? That issue, and those surfaces, have divided a historic block and left the street a half-cobbled, half-paved patchwork of ruts and potholes.

Franklin Street's cobblestone controversy pits some of the artists and professionals who have moved into lofts in the old textile district in lower Manhattan against businessmen still trying to make a living there.And it raises the question of how much the city is willing to spend to preserve a street surface that went out with the horse and buggy.

"At a time when the city is raising taxes and laying people off, it's elitist to spend hundreds of thousands of dollars on cobblestones for one block," said Waring Abbott, who thinks cobblestones belong in a museum. "Why not put them on Fifth Avenue, too?"

But Paul Goldstein, head of the local planning board, calls cobblestones "just a little bit of old New York that people want to retain down here."

The block in question is between Broadway and Church, a 19th century streetscape of cast iron facades, granite slab sidewalks and Belgian cobblestones.

On the buildings' upper floors, potted flowers hang in the windows of airy artists' lofts; on the street, workers lug huge rolls of fabric to and from trucks.

Upstairs and downstairs coexisted peacefully until July, when a road crew arrived and began raising manhole covers, pulling up cobblestones and spreading asphalt.

Donna Downes was aghast. For years she had kept an eye on the cobblestones, even chasing off homeowners who tried to pull them up to pave their patios.

At her behest, a Transportation Department official visited the street the next day. After surveying what had been done, the official pronounced it a mistake: City policy bars blacktopping of cobblestone streets. The stones would have to be replaced.

Meanwhile, several utilities needed to do emergency work under the street. Seeing the asphalt the city had spread, they apparently concluded it was open season on cobblestones and filled their cuts with more asphalt.

By now, the street felt more like a dirt road in Appalachia than an urban thoroughfare. Issac Cherechian, who runs a fabric business, watched as trucks lurched into each other and cars bottomed out. One raised manhole cover caused $6,000 damage to a new Saab.

Cherechian and other businessmen were furious. They had long sought to get the street resurfaced, and now Downes' interference had left it bumpier than ever.

Thus began a small-town feud in the nation's largest city.

Abbott, a photographer who has lived on Franklin for 15 years, joined the fray after receiving an anti-asphalt flyer from Downes' "Franklin Street Block Association."

"It was an organization with no officers, no office, no meetings and no telephone number," he said. "It never occurred to them that some people might actually prefer asphalt because it's easier to walk on and easier to drive on."

Abbott, who seems to love a fight, obtained a city document showing the estimated cost of repairing the cobblestones to be $146,500, compared with $20,000 for asphalt.

He circulated a petition, and Downes did the same. "It's gotten down to, `Whose petition is longer?' " he said. "Ours is."

The city, in the midst of a fiscal crisis, has had second thoughts.

Jeff Maclin, a spokesman for the Transportation Department, said the street probably will be covered with asphalt in the spring because "the cost of restoring the cobblestones is prohibitive."

Downes said her group will sue if necessary. "Cobblestones set the tone of the street," she said. "Some of these textile people are only concerned about the trucks."

And the old cobblestones? They sit in a depot on Staten Island, waiting, perhaps, for a new life on a suburban patio.