The Yonkers City Council reversed itself and approved a court-ordered housing desegregation plan early Saturday, caving in as fines hit $1 million a day, hundreds of workers faced layoffs and public opinion shifted against them.

The 5-to-2 vote came at about 1:30 a.m. following a day of meetings and discussions as pressure grew to resolve the crisis.As the final roll call was called and two of the four recalcitrant councilmen, Peter Chema and Nicholas Longo, reversed their votes, a crowd of about 100 in the gallery at City Hall broke into a chorus of loud cheers. One woman yelled,"You little sneak" at the men.

Both Chema and Longo prefaced the roll-call vote with long speeches to say they had reached agreements with the plaintiffs to make changes in the ordinance, but they also realized the judge would not agree to those changes unless the councilmen changed their votes.

"It's time to put behind the fines, the fight and the turmoil," said Chema.

Speaking of the fines the city has already incurred - a total of $1.6 million, with the threat of millions more - Longo said, "In the past we have thought of those fines somewhat in the abstract. It was the city being fined and the city being affected . . . the abstract has now become a reality."

The city faced a $1 million fine Friday and was to begin laying off hundreds of city workers Saturday. The fines had started at $100 and doubled each day, reaching $819,200 Thursday for a total of $1,638,300.

The city of 194,000 was being held in contempt of court for the City Council's refusal to carry out the housing-desegregation order it approved earlier this year.