Observers feel the magazine's spiraling problems mirror a central struggle within hip hop itself. "The roots of the music are very 'street'," says Minya Oh, alias Miss Info, Hot 97's hip-hop gossip. "But that has to get along with its newer role, which is very big business."

Many industry insiders feel the biggest blow to the magazine's credibility stems from its two-year war against Eminem, whom the magazine has cast as a racist, out to whitewash an African-American art form. (The Source's own founder, David Mays, is white.)

"By battling Eminem, they end up battling the whole family he's down with - 50 Cent, Dr. Dre, Lloyd Banks - the biggest people in the game," explains Nelson George, a long-time observer of popular music and the author of "Hip-Hop America." "How can you sustain and not cover those guys?"

"Regular readers really don't care about the whole back story of the magazine's problems," says Oh. "But they do want to know what Eminem is doing on his vacation or what 50 Cent has to say about Vivica Fox."

To get that information, readers are increasingly flipping over to The Source's rival, XXL. That upstart mag began eight years ago (The Source kicked off back in 1988). In 2003, the younger mag's circulation was little more than half that of its role model. Since then, its circulation has increased by more than 10% to an audited figure of 273,257, the overwhelming majority of them moving on newsstands.

"XXL is now the biggest to us," says a source at Def Jam Records.