The newly appointed white superintendent of a predominantly black school district in the Mississippi Delta resigned late Wednesday, allowing the school board to appoint a black school chief and end a growing racial crisis.

Dr. Willie A. Grissom resigned as superintendent of the Indianola, Miss., Consolidated School District, after local businesses offered to buy out his three-year contract for $90,000.

Yesterday, the school board gave the job to Dr. Robert Merritt, a popular elementary school principal who was the choice of Indianola's black majority. The board, voting along racial lines, originally skipped over Merritt when it offered the job to Grissom in a secret, closed-door meeting last March.

About 92 percent of the school district's 3,000 children are black.

Indianola's long-dormant black community was outraged by the appointment of Grissom, and responded by pulling their children out of the public schools -- forcing a temporary shutdown of the entire system -- and by targeting white-owned businesses for a boycott.

The streets of Indianola had become tense during the ensuing crisis, with black pickets in front of white stores holding placards accusing the town officials of racism. Many whites sympathized with the city's black majority, while others saw the new black activism as a political power play in preparation for the next round of municipal elections, which may be held this year.

Grissom's offer to resign -- something he earlier said he would never do -- and the swift appointment of Merritt won widespread praise in the black community. "It is a victory, not only for the black community, but for Indianola -- white and black," said Willie Spurlock, a legal assistant who became leader of the boycott movement.

The resolution of the conflict also pleased local businesses, who were hurting from the black boycott and who put up the $90,000 to buy out Grissom's contract. "I don't consider it the amount unreasonable," said Tommy McWilliams, a lawyer for concerned businessmen

Blacks and whites said race relations in the town may have been helped by the conflict, since the two groups were forced to finally talk together. A biracial committee formed during the crisis will continue to meet, they said.

"It's a birth to new race relations," Spurlock said. "There may be an open wound, but if you do not pour salt into it, but put a band-aid on it, it will heal."