On a humid Friday night in October, three 19-year-olds crowd into a small New York University dorm room to listen to music. The room is typical: battered posters of Joy Division and Harry Nilsson taped to the walls, an unmade bed, no signs of food save for a box of Life cereal. But the young men, all wearing skinny jeans and faded T-shirts, aren't listening to CDs or MP3s—instead, they're flipping excitedly through stacks of vinyl as if they were attending college in 1977, not 2007. The stack ranges from Fleetwood Mac and "Switched-On Bach" to more such recent releases as Joanna Newsom's "Ys." And as the vinyl record resurges in popularity, the scene is becoming more typical than you'd think.

Against all expectations, the vinyl album has refused to disappear into oblivion like the formats—cylinders, 78s, reel-to-reels and 8-track tapes—that fell before it. Numbers, in fact, show that it's actually enjoying renewed interest in the United States.

Vinyl is so fashionable right now that some retailers, like indie merchant Rob Roth of Fords, N.J.'s, Vintage Vinyl, are even predicting it will "outlast the CD." But others wonder if all the anecdotal testimony about vinyl's sales growth really amounts to a meaningful niche market, or whether the format is just the latest flavor in the industry's seemingly endless hype machine.

As one major-label distribution executive puts it, "I hear everyone talking about vinyl. But I just don't get it."

Sure, vinyl shows big growth percentages, but it's growing from an extremely small base. As of Oct. 28, vinyl albums have scanned 766,000 units—up 22.4% from the 612,000 units scanned in the corresponding period last year, according to Nielsen SoundScan. What's more, vinyl is outselling the cassette album, which has scanned 247,000 units year to date, by a little more than 3-to-1. But the vinyl album still consists of only 0.02% of total album sales. In contrast, digital sales are now 10.7% of album sales and increasing.

On the other hand, some say so much activity has been bubbling around vinyl in 2007, especially in the second half of the year, that it would be more prudent to await the final tallies of this year's data before assessing how the format is performing. That's because label executives almost unanimously say they are now putting out more vinyl.

Click here to read the full article, including details on how label execs are reacting, what part digital downloads play in the trend and more.