Coastal residents to the south, where the storm's gusty wind ripped apart businesses and damaged homes, were hit hardest.

"It just beat us and beat us and beat us," said Laurie Garner, whose boyfriend's restaurant was severely damaged at Salter Path on Bogue Banks, south of the Outer Banks.

While the storm's center was staying off shore, rain bands were continuing to move over the Outer Banks, the National Hurricane Center said.

Gov. Mike Easley said gauging the scope of the damage was difficult because of the storm's slow path, first affecting the state's southeastern coast on Tuesday and then crawling north and east Wednesday and Thursday.

"It's almost like working three different storms," Easley said.

Ophelia was downgraded to a tropical storm and its sustained winds dropped to 65 mph, the hurricane center said early Friday.

More than 9,600 homes and businesses remained without power early Friday in eastern North Carolina, utilities said, down from a high of more than 200,000. But the mainland has not seen the severe flooding many feared.

"I've been coming down here for 25 years _ this is nothing," said Tim Kifer, 51, of Chicago, who stopped by a marina in Manteo to check out the waters of Roanoke Sound.

A moment later, a jogger plodded by along the docks, seemingly oblivious to the hurricane swirling off the coast.

Some decided to take advantage of the churning surf to have a little fun.

David Goddard, 58, of Ashburn, Va., stood on the beach in Nags Head, watching his 32-year-old son Josh wade into the foamy water up to his calves.

"He's fearless," Goddard said with a grin.

The storm was blamed for one traffic death. Earlier, a surfer disappeared in rough water off the coast of South Carolina.

On the Outer Banks, Dare County officials said Hatteras Island reported gusts to 95 mph. Other than power outages, the island was in pretty good shape, said county spokeswoman Sharon Sullivan.

Ophelia, which looped and meandered north since forming off the Florida coast last week, was picking up speed early Friday, moving northeast at about 8 mph, the hurricane center said. At 8 a.m. EDT, Ophelia was centered about 100 miles east-northeast of Cape Hatteras.

A tropical storm watch was in effect for southeastern Massachusetts, including Nantucket and Martha's Vineyard, as well as for southeast Nova Scotia.

Ophelia is the 15th named storm and seventh named hurricane of this year's busy Atlantic season, which ends Nov. 30.

Associated Press writers Margaret Lillard in Salter Path, Gary Robertson in Wilmington and Natalie Gott and Martha Waggoner in Raleigh contributed to this report.