The tens of thousands in the New Orleans diaspora passing through the area and leaving their drowning city behind have to travel 200 miles north, to Monroe near the Louisiana-Arkansas border, before they can hope to find a motel. And then they may balk at the price: even the most flea-bitten hostels have raised their prices as demand for rooms has rocketed. Those evacuees prepared to stump up cash spend their days sitting around motel swimming pools, mobile phones glued to their ears, waiting for news.

Most evacuees, however, have no choice but to take refuge in one of the hundreds of church shelters that have mushroomed across Louisiana and Texas, some of which now house hundreds of people. But, as the last of those who refuse to leave New Orleans are forcibly evacuated, many shelters now have signs saying Full.

It is a word that is fast becoming synonymous with much of Louisiana. Baton Rouge's population is estimated to have doubled to 500,000 in the past week as an estimated 250,000 people have poured into the state capital, turning it into Louisiana's most populous city.

The sudden influx has dramatically altered the region's demographics. Before Katrina, about 50 per cent of Baton Rouge's population was estimated to be black. New Orleans, by comparison, is 70 per cent black. Elsewhere, in the nearby towns of Lafayette and Alexandria, it is a similar story. But as the towns fill up, the Deep South's famed hospitality is stretched to breaking point and the mood is turning ugly.

Gun stores say local people are buying weapons to protect themselves against a perceived threat from outsiders. Signs saying 'We have guns, we buy gold' are now seen frequently outside pawn shops, adding to the post-apocalypse atmosphere. Local people's anxiety is explored on talk radio shows and in whispered conversations in the long queues at Wal-Mart. Residents complain of longer queues in the rush hour and waiting at fast-food restaurants where people used to be served immediately.

'I work in heating and cooling. Last week I sent a man on a 10-minute trip and it took him three hours,' one man, who declined to be named, said. 'And now they say it may be 80 days before they can fully drain New Orleans. We can't wait that long. Baton Rouge had already outgrown its infrastructure as it was,' he said.

In Ouachita Parish, a poor, God-fearing part of Louisiana about 250 miles north of New Orleans, the sheriff, Richard Fewell, articulated what some of his fellow residents are thinking when he expressed reservations about 'the quality' of the evacuees pouring out of a city now inextricably linked to lawlessness in the minds of many Americans. Some local people were outraged by his comments. Most nodded in agreement.

Further south, at the River Centre in Baton Rouge, where several thousand are housed, evacuees talk about being labelled as second-class citizens. 'We wear these bracelets to show where we're staying. You can see [local] people glance at them and you can read the thoughts going through their minds,' said Chantelle, 22, a shop assistant from New Orleans.

'I applied for a job at Jack in the Box [a burger bar]. And when I told them where I was from, you should have seen their faces,' said her friend, Denise, 19.

The River Centre evacuees are eyed suspiciously by private security patrols whenever they venture close to nearby Europe Street, a leafy, well-to-do stretch of attractive wooden houses with quaint porches in the heart of one of the city's most desirable areas. The culture clash with the endless rows of camp beds and refugees crammed into the River Centre is almost tangible.

The President's mother, Barbara Bush, underlined the division between the evacuees and their hosts last week, suggesting those fleeing the flood may be better off because of the hurricane. 'So many of the people in the arena here, you know, were underprivileged anyway,' she said after visiting Houston Astrodome, where thousands are being housed. 'So this is working very well for them.

As many evacuees will not be able to return to New Orleans for months, possibly more than a year, the state authorities are drawing up plans to house some in semi-permanent trailer park homes across Louisiana. One of the biggest of these is likely to be in Port Allen, a joyless industrial area that clings to the west bank of the Mississippi and is home to smoke-spewing refineries and countless breakers' yards.

Given the options of staying put in such grim surroundings or moving on, many New Orleans residents have decided to put as much distance as they can between themselves and their old city.

Igor Szymanski, 37, was living in a $400-a-month apartment in the city when the hurricane struck. As the waters rose he stayed inside, aware a man had been shot five times outside his door when he would not surrender his bicycle to looters. Szymanski had a revolver. A police officer offered to give him ammunition to protect himself from looters, but the officer had only 9mm bullets for a pistol. A friend eventually drove him out of the city.

A Pole by birth and an IT expert, Szymanski is now heading for Chicago, which has a large, tightly-knit Polish community, with the hope of starting a new life. Like many others who ended up in New Orleans, Szymanski had visited it on holiday and decided to stay. He and his girlfriend took dead-end jobs, the city's bewitching aura compensating for the low pay. But the city no longer holds a magic allure.

'We're heading up north to Chicago to get on to higher ground. To a city with a different energy,' Szymanski said. He feels the Windy City won't leave him isolated as New Orleans did, should it suffer a natural catastrophe.

'Chicago is a central point, there's a multitude of options if something goes wrong there,' Szymanski said. He is typical of thousands of others who, having little in the way of roots in New Orleans, other than lowly jobs and rented apartments, now under water, have decided to make new lives elsewhere. Katrina, it seems, has acted as a catalyst, convincing the Big Easy's residents to follow the yellow brick road to a new life elsewhere.

According to the Louisiana Department of Social Services, there are now 130,000 people staying in shelters in Texas and Louisiana and a further 20,000 in other states across the US. The figures do not include those who are staying with family or friends or in hotels.

Several thousand people in the two states are already estimated to have checked themselves into long-term accommodation, a sign that they do not intend to return to New Orleans soon. Of the 15,000 or so evacuees who were housed in the Houston Astrodome, only about 3,000 are now left, many having managed to find work and housing in the Lone Star state.

The federal government's Department of Veterans has already started selling some of its housing stock, accrued through foreclosing on homes owned by former soldiers who defaulted on their mortgage payments, to New Orleans's evacuees wanting to make new lives further north in Louisiana or neighbouring Alabama.

In addition, about 6,000 children from the New Orleans area have been enrolled at schools in Texas, and a further 12,000 in Louisiana, creating emotional links that may prove difficult for their parents to break whenever they are given the green light to return.

Many former residents of the Gulf Coast region believe it is inevitable that another Katrina will visit the area and have convinced themselves to start afresh in a lower-risk area. 'I'm not going back. You can't live in a bowl,' said Alice, 73, referring to the way New Orleans is built below sea level, protected by the 350-mile network of levees surrounding the city.

'I got relatives in Florida. They tell me life is good there, so I'm going,' said Duane Williams, 23, a trainee mechanic.

There were concerns about New Orleans's demographics long before Katrina rent her destruction. The city's population has been shrinking for decades, thanks in part to rising unemployment and crime levels which have driven people away. Today it is estimated that about 450,000 people are counted as living there, compared with 630,000 in 1960.

Situated on the border between the states of Mississippi and Louisiana, the city is in one of the poorest regions in the US. The average wage in Mississippi is $24,650, the lowest in the US and more than $7,000 below the national average. Louisiana was ranked 42nd poorest state with an average wage of $27,795.

The city's mayor, Ray Nagin, had been acutely worried about the city's shrinking population and had drawn up a $4 billion development programme to stimulate the economy and create jobs before Katrina struck. But the programme, and with it the hopes of securing New Orleans's long-term future, has been subsumed by Hurricane Katrina.

There are doubts about whether the numerous casinos built on barges in the Gulf of Mexico, now reduced to matchsticks, will be rebuilt, something that would see the loss of thousands of jobs in the area.

Big blue-chip companies are already moving their Louisiana headquarters from New Orleans to other parts of the state. Given the increase in insurance premiums they will need to pay to return to the city, many could end up deciding to make the switch permanent. It is estimated a third of the city's 34,000 businesses will end up having to move offices for some time.

'This is all moving very, very quickly,' said Stephen Moret, president of the Baton Rouge Chamber of Commerce. 'I'm told businesses are making permanent decisions now,' he told the Advocate newspaper.

Experts say it is likely that the poorest, predominantly black sections of New Orleans's society will feel the economic downturn hardest, raising questions over whether they will want to return to a city with dubious prospects. Experts are already predicting that unemployment on the Gulf Coast will rise to 25 per cent in the short to medium term as a result of Katrina. Again, inevitably, the poorest will be hit the hardest.

'There's no question that the recovery is going to be much longer and more painful for the 28 per cent of the local population in the New Orleans area living below the poverty line,' Liz Ann Sonders, chief investment strategist at stockbroker Charles Schwab told the News Star newspaper.

'The population in Louisiana and Mississippi is incredibly poor. Most of the damage was from flooding, which doesn't tend to be covered by insurance,' Mark Vitner, the senior economist at Wachovia Bank, said. 'That combination adds up to an incredibly long and painful rebuilding process - I think five to 10 years,' Vitner said.

It is a gloomy prognosis, but one with which many of New Orleans's institutions seem to concur.

Louisiana's supreme court has moved to a temporary new home in Baton Rouge. And, perhaps, most symbolically, the New Orleans' Saints, the city's American football team, has decamped, at least temporarily, to San Antonio in Texas. For years the team's owner, Tom Benson, has been fighting the authorities to replace the team's stadium, the Superdome, which was home to about 25,000 evacuees following the flood and which has been left badly damaged.

Local sports pundits believe that Benson may now use Katrina as an excuse to move the team to Texas or, perhaps, Los Angeles, which is without a National Football League team.

Whether New Orleans can reclaim its status as one of America's great cities now hinges on the federal government's economic response. It is estimated that Katrina's damage may end up totalling more than $100 billion, roughly five times the cost of the 11 September atrocities. This at a time when the Bush administration wants to make budget cuts in welfare and health programmes to reduce a $316bn budget deficit. Some senators have even expressed doubts about whether it makes sense to resurrect a city built on swampland, despite its distinguished heritage.

For his part, Nagin, who seems to be battling hard to suppress his anger at the way that Louisiana Governor Kathleen Babineaux Blanco and the federal authorities have handled Katrina's aftermath, is trying to paint a bright future for New Orleans. 'We will rebuild,' he pledged last week in the middle of a city now denuded of almost all its people.

But thousands of New Orleans's residents no longer care for such promises. They have gone to forge new lives elsewhere. And they are not coming back.