In a marathon session that exposed all the ethnic fault lines of this diverse megacity, the Los Angeles Board of Education moved Thursday night to oust the superintendent of the nation's second-largest school district, a multibillion-dollar empire that almost all sides agree is in shambles.

But this is not the typical firing of a school leader. The superintendent is Ruben Zacarias, a popular figure in the Latino community, which believes that it is being denied clout in a school district of 700,000 students, of which almost 70 percent are Latino.

The shove out the door given to Zacarias, 70, has rankled many, particularly Latinos, who are angered that the lifelong veteran of the school district is being pushed into retirement by recently elected reformers who were backed by Republican Mayor Richard Riordan.

The showdown is creating waves in the city's politics and is raising questions that will be answered in next year's mayoral campaign:

Who--or what coalition--will run this everchanging city, and how will the growing number of Latinos transform Los Angeles?

It also has renewed calls for the city to break up the school district--part of an ongoing secessionist movement to divide Los Angeles into smaller jurisdictions.

Some Latino activists and politicians charge that they are being challenged by a virtual "shadow government" of mostly Anglo downtown business interests, and on Thursday night they renewed their threats to have the school district put into receivership by the state and broken up, creating a new eastside district that Latinos would control.

"This isn't about reform, this is about who is taking over our schools," said Gina Alonso, a leader of the group Latinos for Excellence in Education. A staunch Zacarias supporter, Alonso spoke in the hallway outside a school board meeting filled to capacity, with protesters milling outside.

"I say, okay, you don't want us, fine, we'll take our 70 percent and form our own school district and you can take the 30 percent and have yours," she said.

The school board, with three new members this year, has one black member, one Latino member and five white members. The district's student population last year was 69.1 percent Latino, 13.6 percent black and 10.5 percent white.

While all the players insist they have students as their central concern, the Zacarias imbroglio has clearly again stirred up ethnic politics in Los Angeles.

The clash is creating the same polarizing and sometimes raw atmosphere that blanketed this city during the O.J. Simpson trial and the riots that followed the acquittal of white police officers in the beating of black motorist Rodney King.

"For some Latino politicians and activists, this is it. They are using Zacarias to test their political clout," said Earl Ofari Hutchinson, an author and political commentator who has written much about African American political power in the city. "They're circling their wagons around him, and saying this is our testing ground, this is our proving ground. And they're telling the city's political establishment that the Latinos are here and don't mess with us."

The huge Los Angeles school district is, by almost all accounts, in crisis. Test scores are abysmal. Dropout rates are among the highest in the nation. Classrooms are overcrowded and often led by teachers without credentials. And the buildings are falling apart. At one school, thousands of students use a single working toilet.

To keep up with demand, the district must build 100 new schools in the coming years. But school officials are so far behind in planning that the district might lose precious state and federal funding. The worst example is the sputtering attempt to build the $200 million Belmont Learning Center, a huge school near downtown that is sorely needed to ease overcrowding. But it is on hold because the site sits atop an old oil field contaminated with toxic waste and residue.

The new school board members said they decided to act against Zacarias when they found out that another school site also was contaminated.

And so two weeks ago, in a closed-door meeting, a majority of school board members, led by the Riordan-backed reformers, chose to install Howard Miller as the new chief executive officer of the school system. Miller will control all aspects of the district and answer only to Zacarias, who has been relegated to being the district's "visionary," but with far diminished power. Miller is a white real estate lawyer close to Riordan's inner circle. He served on the school board in the 1970s, but he was recalled for his support of busing.

His appointment was too much for some in the Latino community, who have decried a lack of "respect" from the new school board.

The leader of the Mexican American Legal Defense Fund, Antonia Hernandez, said the move against Zacarias was not only unfair, but also illegal because the board met without public comment and had not yet formally evaluated Zacarias's three-year tenure. In an opinion piece in the Los Angeles Times, Hernandez also suggested that business had taken a new interest in the school system because hundreds of millions of dollars' worth of contracts and services are at stake because of the new construction.

A powerful state senator, Richard Polanco, who represents heavily Latino East Los Angeles, led protests during the turmoil, also making charges about a "shadow government" and saying Latinos want to have "our own team" more in charge of the schools.

A defiant Zacarias said at an earlier news conference on Thursday that he would not resign or be bought out.

"This is not about race or ethnicity," he said. "I would do everything possible to shut down anyone that makes an ethnic or religious or cultural or racial issue out of what's happened."

But many residents wonder why Zacarias should not be held accountable for the school system's failings. He was among nine officials faulted by an audit of the Belmont project. Making the site safe could cost millions.

A poll published today by the Los Angeles Times found that only 40 percent of Latinos back the superintendent, and most Latinos who responded did not believe that his ouster was racially motivated.