A federal appeals court heard conflicting legal arguments this morning on whether Philadelphia's most notorious death-row inmate received a fair trial in 1982 when he was convicted of killing police officer Daniel Faulkner.

The court proceeding marks a turning point in the case of Mumia Abu-Jamal, a former radio reporter and Black Panther who has been trying to escape the death penalty for 25 years.

If the U.S. Court of Appeals for the Third Circuit upholds the death sentence, Abu-Jamal would be more at risk of execution than at any point in the last 25 years.

While hundreds gathered in support of Abu-Jamal outside the federal courthouse in Center City, the legal argument inside focused squarely on the law as a three-judge panel of the Third Circuit extensively questioned lawyers on both sides about whether the prosecutor in the 1982 trial intentionally excluded blacks from the jury.

The court is not expected to rule on the matter for several months.

Abu-Jamal, now 53, was found guilty and sentenced to death in July 1982 by a predominantly white Philadelphia jury. The Pennsylvania Supreme Court upheld his conviction in 1989 and also refused to grant him relief on his second appeal to that court.

And when his case moved to federal court, U.S. District Judge William H. Yohn Jr. rejected 28 of the 29 legal points raised by the defense.

But Yohn did rule in favor of Abu-Jamal in deciding that the jury may have mistakenly believed it had to agree unanimously on any "mitigating" circumstance that might have persuaded jurors to decide on life imprisonment rather than death.

Therefore, Yohn said, Abu-Jamal should be sentenced to life, instead of death, or get a new hearing only on the question of whether his sentence should be death or life.

After the two-hour proceeding, people on both sides of the controversial case said they thought the judges were well-prepared and fair to both prosecutors and lawyers for Abu-Jamal.

"They were informed. They asked very important questions. I think they seemed impartial," said Francis Goldin, Abu-Jamal's literary agent.

Maureen Faulkner, the widow of Faulkner, said that she, too, thought the judges were fair. "I have to trust that the federal courts will look at what's presented to them to . . . make a fair decision," said Faulkner, who traveled from California for the hearing.

The Third Circuit will now review Yohn's reasoning and consider whether there was racial bias during jury selection, and whether Abu-Jamal's constitutional rights were violated by the prosecutor's closing argument and by the alleged bias of the trial judge, Albert Sabo, during post-conviction review.

The Third Circuit could:

- Reverse Yohn and uphold the death sentence.

- Uphold Yohn and order a new sentencing hearing.

- Grant a new trial.

- Send the case back to Yohn for a hearing.

Should the court uphold the death sentence, Abu-Jamal would be more at risk of execution. Even so, he could attempt to persuade the U.S. Supreme Court to hear the case, or try to go back again to the Pennsylvania Supreme Court, where he still has one petition pending.

The three judges hearing the case are Chief Judge Anthony J. Scirica, who was appointed by President Reagan, and Judges Thomas L. Ambro, appointed by President Clinton, and Robert E. Cowen, appointed by Reagan.