The Supreme Court heard arguments yesterday over whether states can be barred from disclosing the personal information drivers provide to get a license. The case goes to the heart of privacy concerns in an era of instant electronic data and, more broadly, invokes questions about Congress's power to address social problems in the states.

Arising from congressional worries about stalkers, robbers and other criminals who might use motor vehicle records to track down victims, the 1994 Driver's Privacy Protection Act forbids states to sell addresses, telephone numbers and other information that drivers put on license applications.

South Carolina, backed by a dozen states, contends that the law is a burden to administer and unconstitutionally infringes on state authority. It has urged the justices to strike it down and continue the court's recent pattern of curtailing federal power in favor of state autonomy.

The dispute in Reno v. Condon raises questions about the division of power between Washington and the states, a topic that sounds like the stuff of civics books but that has important real-world ramifications.

Such issues were front and center yesterday. Some of the justices suggested that if the court struck down the drivers' privacy act, other federal laws would be in jeopardy. An overriding question is whether the court will reconsider a 1985 ruling that upheld the application of a federal minimum wage and overtime law to municipal workers.

In that case, Justices William H. Rehnquist (who would become chief the following year) and Sandra Day O'Connor dissented, warning that in time a new court majority would stop the trend of federal policy treading on local activities. Nearly 15 years later, Rehnquist and O'Connor, along with Justices Antonin Scalia, Anthony M. Kennedy and Clarence Thomas, form a new majority engaged in curbing federal power.

Yesterday's case, however, did not appear to present a clear-cut majority for overturning the drivers' privacy law.

Appeals courts are divided over the constitutionality of the privacy law, which took effect in 1997 and undercuts a state's ability to make money selling personal data to businesses and individuals. In the South Carolina dispute, the 4th U.S. Circuit Court of Appeals struck down the law, saying it wrongly forced states to administer a federal regulation. The act has exceptions to the ban on disclosure--for example, allowing information to be released for public safety and anti-fraud purposes--and states say it is complicated to oversee.

South Carolina Attorney General Charles Condon told the justices the law presses states into national service, making them "puppets" of the federal government.

Solicitor General Seth P. Waxman, defending the law, emphasized the threat to personal security from the nationwide dissemination of names and addresses. He mentioned actress Rebecca Schaeffer, who was slain by a stalker who obtained her address from driver's license records and whose murder was an impetus for congressional action.

Waxman said the law falls under Congress's authority to regulate interstate commerce but he added that Congress recently tied the disclosure restrictions to a state's receipt of transportation funds, thereby anchoring the law also in its constitutional spending power.

Kennedy questioned whether the law might improperly "blur the line" between activities of the states and of Washington. He likened the drivers' privacy act to a law the court invalidated two years ago requiring local sheriffs to do background checks on handgun buyers.

O'Connor was similarly concerned about whether Congress was encroaching on core state functions--keeping motor vehicle records--and suggested that if the court were to strike down the law it might have to revisit the 1985 case that subjected states and cities to fair labor standards.

Justices David H. Souter and Stephen G. Breyer pressed Condon on whether, if South Carolina prevailed, other laws enacted under Congress's power to regulate interstate commerce would fall. Condon insisted they would not, but those justices and others were skeptical.

In a second case, the justices considered First Amendment protections for nude dancing arising from an Erie, Pa., ban on nudity that the Pennsylvania Supreme Court rejected as too broad and a violation of free expression. The last time the court took up such a case, in 1991, it upheld an Indiana public indecency statute outlawing nude dancing. The court said nude dancing is subject to some First Amendment protection but that other community interests of safety and morality can be overriding.

Whether the justices will clarify that ruling, which some lower courts say is a muddle, remains to be seen. The adult establishment that challenged the Erie ordinance has since gone out of business, and some of the justices said yesterday the case of City of Erie v. Pap's A.M. might be moot.