A federal appeals court ruled yesterday that the head of the National Archives can authorize government agencies to destroy electronic mail and other computer records as long as copies of the materials are kept in some form--whether on paper, microfilm or in other computer systems.

The ruling was a setback for the nonprofit advocacy group Public Citizen, which contended that government computer records must be preserved in electronic form so that they are more readily accessible to public review.

Joined by independent researchers and historical organizations, the group filed a lawsuit in U.S. District Court challenging a regulation issued in 1995 by Archivist of the United States John W. Carlin.

The rule--known as GRS (General Records Schedule) 20--cleared the way for government agencies to wipe out e-mail and other computerized records without regard for content.

Despite the regulation's requirement that backup records be kept, the group expressed fears that valuable materials from the White House, State Department and other major agencies might be lost to historians forever.

U.S. District Judge Paul L. Friedman struck down the regulation in 1997, saying "electronic records are rarely identical to their paper counterparts."

Under pressure from Friedman, the National Archives began devising a better electronic record-keeping system. Officials said yesterday they will move forward with the new system, saying they will act "in an orderly way to develop practical, workable strategies and methods for managing and preserving records in the electronic age and ensuring ready access to them."

Yesterday's ruling allows Carlin to move at his own pace and gives him the discretion he has said he needed to guide agencies "to avoid system overload and to ensure effective records management." Within the next few years, experts have estimated that 75 percent of the government's record-keeping will be done on computers.

Public Citizen lawyer Alan B. Morrison said the group is evaluating whether to appeal the panel's decision.

Although disappointed, Morrison contended the lawsuit and Friedman's ruling pushed Carlin to make improvements that will minimize the need for paper or microfilm backups.

"If he had done back then what he's doing now, there wouldn't have been a lawsuit," Morrison said, expressing hope that the progress will continue.

The three-judge panel from the D.C. Circuit Court of Appeals unanimously ruled that Carlin acted appropriately in issuing the GRS rule and said he tried to balance the conflicting demands set by Congress of "judicious preservation and disposal of records."

Because agencies were to save records in another electronic format, on microfilm or paper, Judge Douglas H. Ginsburg found "there is no risk that information will be lost to future users." Judges Laurence H. Silberman and Stephen F. Williams joined in the 20-page opinion.

While agreeing that "electronic record-keeping has advantages over paper record-keeping," the panel said Carlin's policy choice was reasonable.