The San Francisco Examiner, the once-proud newspaper that William Randolph Hearst used to forge a media empire, fired most of its staff today but vowed to continue as a free daily put out by a handful of workers.

About 2:30 p.m. Pacific time, the paper's 40 remaining staffers were told that most of them were being laid off and were given an hour to leave. Then the lights in the building were shut off, the phones were disconnected and the main door was locked as staff members went to a nearby bar to figure out what had happened.

The move came less than a year after the paper recast itself as a tabloid-style morning newspaper in a bid to lure more readers, and about three years after the paper was bought by the Fang family from the Hearst chain in a deal that allowed Hearst to purchase the city's main newspaper, the Chronicle. The Fang family received about $67 million in subsidies from Hearst to operate the paper over a three-year period.

"Examiner on life support, situation critical," laid-off editor Martin Stein said. "I didn't see it coming at all. I thought they would at least try and sell the paper.

"We were told the Examiner was going in a different direction," he added.

Political editor Frank Gallagher, who remains employed, said the paper was going to come out on Monday without losing anything. It may draw on staff from the Fang family's weekly newspaper.

The skeleton staff will continue to put out the paper that once duked it out with the Chronicle to be San Francisco's newspaper of record.

That changed, however, in 2000, when Hearst provided a controversial subsidy to the Fang family to take charge of the struggling afternoon Examiner and clear the way for the Hearst purchase of the Chronicle.

In the complex deal, the company eventually offered $660 million for the Chronicle while addressing antitrust concerns by giving Fang the subsidy to produce a new newspaper under the Examiner name.

Although it was challenged in court, that deal was eventually upheld -- sealing the fate of Hearst's self-described "monarch of the dailies."

The new owners had promised to make the 137-year-old newspaper -- which has employed such writers as Jack London, Mark Twain and Hunter S. Thompson -- a voice of diversity with a bent for local news.

But the effort of the Fangs -- the first Asian American family to own a major U.S. metropolitan daily -- was hobbled by financial problems, high-profile turnover and family infighting, culminating with matriarch Florence Fang ousting her son Ted as the newspaper's editor and publisher.

Founded in 1865, the Examiner was taken over in 1887 by budding press baron William Randolph Hearst, who used it as an early experiment of his own special brand of "yellow journalism" featuring raucous, no-holds-barred coverage that did not stint on sensationalism, personal attacks or partisan grandstanding.

Examiner dance critic Rachel Howard and her fiance, Bill Fischer, after emptying her desk.