The city of New Orleans will begin to reopen this weekend, Mayor C. Ray Nagin announced on Thursday, the first step toward reversing the unprecedented evacuation and closure of a modern American city.

The city has been largely shuttered, abandoned and militarized since the floods from Hurricane Katrina, but by the weekend, owners of shops, restaurants and other businesses may return to the portions of New Orleans that remained relatively dry, Nagin said. And by Monday, the first residents may begin to filter into the city neighborhood known as Algiers. Residents of Uptown and the French Quarter will follow.

The reentry plan will repopulate areas that, before the storm, were home to 182,000 people, or about a third of the city's residents.

"We will have life, we will have commerce, we will have people getting back into their normal modes of operation and the normal rhythm of the city of New Orleans that is so unique," Nagin said.

Formidable challenges remain, however, even for that third of the population that may return.

Authorities warned residents not to drink or bathe in the water in most of the city because contaminated floodwaters are seeping into waterlines through major breaks. The 911 emergency-call system is not fully operational. Even in the least affected areas, thousands of homes are without power, and the lack of traffic lights has led to accidents among some of the emergency vehicles rolling through city streets.

Asked whether the reentry plan may be premature, Nagin said, "I'm getting all kinds of push that I'm moving a little too slow."

Some residents have already begun sneaking into the city to assess the damage or retrieve clothes. A few have been pleasantly surprised.

Amanda Zirkenbach, 28, returned to her "shotgun double" home in the Mid-City section of New Orleans. With its fancy porch and balustrades, it is typical of many older homes in a city where as many as 37,000 buildings are in historic districts. It is also raised about five feet above the ground.

"The water just came up to the top of the front steps," she said of the home once occupied by her grandparents. "Those old architects knew what they were doing. They built them up higher because they didn't have the modern levees to protect us."

The news could be worse for other portions of the city, some of which may remain underwater until early October, authorities said. Of the 160,000 homes in the city, it is not known how many were destroyed by the flooding.

Nagin said he estimates that about 60,000 may be beyond repair. That could leave tens of thousands of former residents in shelters far away from home for months and possibly longer.

Viewed from the street, hundreds of homes that had been underwater and have since dried show little damage aside from the mud and a waterline. Elsewhere, old wood-frame houses apparently floated in the flood, smashed into one another and splintered. Experts say the structural integrity of many homes may have been undermined, and officials note that the worst damage may be in those homes that have been inundated for two weeks or more.

An official of the U.S. Army Corps of Engineers said on Thursday that downtown New Orleans will be clear of floodwaters by Oct. 2, and the eastern part of the city by Sept. 30 -- which is a week earlier than previous estimates. Plaquemines and St. Bernard parishes south and east of the city are also expected to be clear of floodwaters by the end of this month, earlier than predicted.

Col. Duane Gapinski said pumps are removing about 7 billion gallons of floodwater a day, although about 45 percent of the city remains inundated. Another official said the Corps has removed 240,000 cubic yards of debris.

Unsure whether businesspeople will return in large enough numbers to serve the residents, Nagin said he has contacted three major businesses about the possibility of temporarily setting up shop in the city's Convention Center and providing food and other necessities.

Health care is another concern, with floodwaters containing dangerous amounts of bacteria.

Nagin said Children's Hospital will be open for emergencies. But Brian Landry, a hospital vice president, said it will likely be a couple of weeks before the Uptown hospital could open its doors.

Landry said staff members who had evacuated will have to be brought back.

Aside from worries that damaged homes could collapse on returnees, another key concern for city officials is law and order.

Nagin touted the fact that, with the emptying of the city, it is "crime-free and drug-free" for the first time in years. "The bad guys have been rooted out," he said.

Authorities said they will do what they can to keep out the criminals who had plagued the city for years. They said the city will initially be under a dusk-to-dawn curfew.

Even though the New Orleans police force has dwindled from 1,750 to 1,350 officers since Hurricane Katrina, Police Superintendent P. Edwin Compass III expressed confidence Thursday that the diminished force could handle the task. "We have a much smaller city to police," he said.

The National Oceanic and Atmospheric Administration said Thursday that Hurricane Katrina was the most destructive storm to strike the United States, the Associated Press reported. State and local officials said the death toll as of Thursday was 558 in Louisiana and 218 in Mississippi.

Staff writers David Brown in New Orleans and Ceci Connolly in Baton Rouge, La., contributed to this report.

Receding floodwaters have left mud and debris in New Orleans's Ninth Ward. Mayor C. Ray Nagin estimates that as many as 60,000 of the 160,000 homes in the city may be beyond repair.