SAN FRANCISCO (Reuters) - As Hurricane Sandy pounded the U.S. Atlantic coast on Monday night, knocking out electricity and Internet connections, millions of residents turned to Twitter as a part-newswire, part-911 hotline that hummed through the night even as some websites failed and swathes of Manhattan fell dark.

But the social network also became a fertile ground for pranksters who seized the moment to disseminate rumors and Photoshopped images, including a false tweet Monday night that the trading floor at the New York Stock Exchange was submerged under several feet of water.

The exchange issued a denial, but not before the tweet was circulated by countless users and reported on-air by CNN, illustrating how Twitter had become the essential - but deeply fallible - spine of information coursing through real-time, major media events.

But a year after Twitter gained attention for its role in the rescue efforts in tsunami-stricken Japan, the network seemed to solidify its mainstream foothold as government agencies, news outlets and residents in need turned to it at the most critical hour.

Beginning late Sunday, government agencies and officials, from New York Governor Andrew Cuomo(@NYGovCuomo) to the Federal Emergency Management Agency (@FEMA) to @NotifyNYC, an account handled by New York City's emergency management officials, issued evacuation orders and updates.

As the storm battered New York Monday night, residents encountering clogged 9-1-1 dispatch lines flooded the Fire Department's @fdny Twitter account with appeals for information and help for trapped relatives and friends.

One elderly resident needed rescue in a building in Manhattan Beach. Another user sent @fdny an Instagram photo of four insulin shots that she needed refrigerated immediately. Yet another sought a portable generator for a friend on a ventilator living downtown.

Emily Rahimi, who manages the @fdny account by herself, according to a department spokesman, coolly fielded dozens of requests, while answering questions about whether to call 311, New York's non-emergency help line, or Consolidated Edison.

At the Red Cross of America's Washington D.C. headquarters, in a small room called the Digital Operations Center, six wall-mounted monitors display a stream of updates from Twitter and Facebook and a visual "heat map" of where posts seeking help are coming from.

The heat map informed how the Red Cross's aid workers deployed their resources, said Wendy Harman, the Red Cross director of social strategy.

The Red Cross was also using Radian6, a social media monitoring tool sold by Salesforce.com, to spot people seeking help and answer their questions.

"We found out we can carry out the mission of the Red Cross from the social Web," said Harman, who hosted a brief visit from President Barack Obama on Tuesday.

SPREADING INFORMATION

Twitter, which in the past year has heavily ramped up its advertising offerings and features to suit large brand marketers like Pepsico Inc and Procter & Gamble, suddenly found itself offering its tools to new kind of client on Monday: public agencies that wanted help spreading information.

For the first time, the company created a "#Sandy" event page - a format once reserved for large ad-friendly media events like the Olympics or Nascar races - that served as a hub where visitors could see aggregated information. The page displayed manually- and algorithmically-selected tweets plucked from official accounts like those of New York Mayor Michael Bloomberg and Governor Chris Christie of New Jersey, who was particularly active on the network.

Agencies like the Maryland Emergency Management Agency and the New York Mayor's Office also used Twitter's promoted tweets - an ad product used by advertisers to reach a broader consumer base - to get out the word.

The company said offering such services for free to government agencies was one of several initiatives, including a service that broadcasts location-specific alerts and public announcements based on a Twitter user's postal code.

"We learned from the storm and tsunami in Japan that Twitter can often be a lifeline," said Rachael Horwitz, a Twitter spokeswoman.

Jeannette Sutton, a sociologist at the University of Colorado who has received funding from the National Science Foundation and the Department of Homeland Security to study social media uses in disaster management, said government agencies have been skeptical until recently about using social media during natural disasters.

"There's a big problem with whether it's valid, accurate information out there," Sutton said. "But if you're not part of the conversation, you're going to be missing out."

As the hurricane hit one of the most wired regions in the country, news outlets also took advantage of the smartphone users who chronicled rising tides on every flooded block. On Instagram, the photo-sharing website, witnesses shared color-filtered snapshots of floating cars, submerged gas stations and a building shorn of its facade at a rate of more than 10 pictures per second, Instagram founder Kevin Systrom told Poynter.org on Tuesday.

Many of the images were republished in the live coverage by news websites and aired on television broadcasts.

LIES SLAPPED DOWN

But by late Monday, fake images began to circulate widely, including a picture of a storm cloud gathering dramatically over the Statue of Liberty and a photoshopped job of a shark lurking in a submerged residential neighborhood. The latter image even surfaced on social networks in China.

Then there was the slew of fabricated message from @comfortablysmug, the Twitter account that claimed the NYSE was underwater. The account is owned by Shashank Tripathi, the hedge fund investor and campaign manager for Christopher Wight, the Republican candidate to represent New York's 12th District in the U.S. House of Representatives.

Tripathi, who did not return emails by Reuters seeking comment, apologized Tuesday night for making a "series of irresponsible and inaccurate tweets" and resigned from Wight's campaign.

His identity was first reported by Jack Stuef of BuzzFeed.