The men from the land down under turned the sailing world upside down today.

Australia II's crew conquered what their prime minister called "yachting's Everest" when they slid past Liberty late in the seventh and deciding America's Cup race on placid Rhode Island Sound, then held off a furious upwind challenge to end the longest winning streak in sports.

The seventh and final race for the treasured silver trophy the New York Yacht Club had held through 24 challenges and 132 years ended at 5:22 this afternoon in a rosy dusk. The white challenger with the radical, winged keel slipped across the finish 41 seconds ahead of the United States' red Liberty.

Australia II, which won three straight races to take this series after falling behind, 3-1, was engulfed immediately in a sea of cheering admirers as yachts from the spectator fleet roared to her side.

The crowd of thousands that accompanied her home in a gathering darkness was rewarded in harbor when their cries of, "Let's see the keel, let's see the keel," were answered with the first public unveiling of her magical underwater appendages.

Ben Lexcen, the yacht designer who invented the boat and the keel that ended an era, watched in horror as Australia II was hoisted from the water and, in his words, "about 500 Americans hung on it (the keel) like leeches."

Lexcen and syndicate chief Alan Bond had little to cheer most of the race as Liberty led from halfway through the first leg until only about six miles remained in the 24.3-mile course.

Conner, the defending cup champion, won the start in 8-knot breezes, lost the lead a short way up the first leg but regained it and held on.

Australia hung close behind, never trailing by as much as a minute in the gentle southerly, but though the Australians were close, the final lead change late in the day was as unexpected as any development in this surprise-filled cup summer.

Conner was sailing brilliantly and the American syndicate chiefs aboard Liberty's motor tender, Fire Three, looked confident as she turned down the next-to-last leg 57 seconds ahead with her spinnaker full and the wind and Australia II at her back.

But Conner maneuvered onto the left side of the course and the Aussies took the right. When the breeze filled in, it came from the right and Australia II sped up. Conner turned back to try to stave off the white boat, but Australia II crossed Liberty's bow and was not headed again.

"He fouled up," said Australian tactician Hugh Treharne of Conner's decision to take the left side, "and it cost him the race." Treharne said Conner never should have left Australia II alone. "We were faster, but if he stayed between us and the next mark, we'd have to pick up our mast and carry it over him to get ahead."

Conner had removed about a half-ton of ballast weights from Liberty for this race, reasoning that Australia II, two tons lighter, would be too quick in today's light air, which never exceeded 10 knots. The tactic worked as long as the boats were sailing into the wind, but in the two legs where they turned their transoms to the breeze, Australia went faster. That turned out to be the race.

"We recognized the terrific advantage Australia II had downwind in light winds all summer," said Liberty navigator Halsey Herreshoff. "We were afraid we couldn't hold them off and that was the case."

With Liberty 21 seconds behind as the boats turned for the final 4 1/2 miles into the breeze, Conner steered his boat through the wind 47 times in a desperate bid to catch up, tacking back and forth across the course at half-minute intervals while his crew strained to trim the sails. It was herculean, but Bertrand echoed Conner's every move and the Americans were left no hole to sneak through.

Approaching the finish the boats were silhouetted against the setting sun, Australia II four boat lengths ahead. A puff of smoke from the race committee yacht, Black Knight, signaled the end of the race and the end of a dynasty.

The 25th and last challenge for the cup the yacht America won from a fleet of British boats in 1851 was over. The name America's Cup remains, but it will next be contested 12,000 miles away, off Perth.

The Australians will entertain challenges for a series expected to start in January 1987 or 1988, and already several American yachtsmen have said they will be there, including Liberty syndicate chief Ed duMoulin and veteran 12-meter sailor Gary Jobson of Annapolis.

What lost the cup?

"Arrogance," said Harold Cudmore, former helmsman of the unsuccessful British entry Victory '83. "The New York Yacht Club knew what they were up against in June. They could have built a boat to compete with Australia, but they were so so certain of their superiority that they didn't."

What won it?

"Perseverance," said Lexcen, the designer who hatched the notion of wings on the bottom of a keel and saw it through. "People have been toying with the idea for years," he said, "but they always started out thinking it wouldn't work . . .

"But I knew it would, and I kept at it until it did. We ended up changing the whole concept of the boat to make it work."

Tonight he tasted sweet victory as Australia II swept into Newport Harbor to a cacaphony of horns, cheers and jubilation. The crew was mobbed by admirers who jammed Thames Street so thickly it took them a half-hour to go one block to the victory press conference.

While the Australians celebrated and battled the crowds, Conner made a quick parting statement, his voice choked with emotion. "There is no reason for Americans to think that they are anything but No. 1," he said. "Australia II was just a better boat and they beat us. Today was their day."

The New York Yacht Club had announced that if the Australians won, the cup would be presented two days after the last race, in New York. But tonight they said it would be in Newport at a time and place to be announced Tuesday.

Australian syndicate chief Alan Bond is expected to take delivery. Lexcen, the mind behind a 12-meter revolution, said he's going home. committee yacht, Black Knight, signaled the end of the race and the end of a dynasty.

The 25th and last challenge for the cup the yacht America won from a fleet of British boats in 1851 was over. The name America's Cup remains, but it will next be contested 12,000 miles away, off Perth.

The Australians will entertain challenges for a series expected to start in January 1987 or 1988, and already several American yachtsmen have said they will be there, including Liberty syndicate chief Ed duMoulin and veteran 12-meter sailor Gary Jobson of Annapolis.

What lost the cup?

"Arrogance," said Harold Cudmore, former helmsman of the unsuccessful British entry Victory '83. "The New York Yacht Club knew what they were up against in June. They could have built a boat to compete with Australia, but they were so so certain of their superiority that they didn't."

What won it?

"Perseverance," said Lexcen, the designer who hatched the notion of wings on the bottom of a keel and saw it through. "People have been toying with the idea for years," he said, "but they always started out thinking it wouldn't work . . .

"But I knew it would, and I kept at it until it did. We ended up changing the whole concept of the boat to make it work."

Tonight he tasted sweet victory as Australia II swept into Newport Harbor to a cacaphony of horns, cheers and jubilation. The crew was mobbed by admirers who jammed Thames Street so thickly it took them a half-hour to go one block to the victory press conference.

While the Australians celebrated and battled the crowds, Conner made a quick parting statement, his voice choked with emotion. "There is no reason for Americans to think that they are anything but No. 1," he said. "Australia II was just a better boat and they beat us. Today was their day."

The New York Yacht Club had announced that if the Australians won, the cup would be presented two days after the last race, in New York. But tonight they said it would be in Newport at a time and place to be announced Tuesday.

Australian syndicate chief Alan Bond is expected to take delivery. Lexcen, the mind behind a 12-meter revolution, said he's going home.