Other companies and research centers, like I.B.M. Research and Lernout & Hauspie Speech Products, are also experimenting with this technique -- which is called concatenative speech synthesis -- to improve the quality of text-to-speech software. It is a big step up, engineers say, from the speech engines that were built from whole words that had been pre-recorded. And it is also a vast improvement, some say, from the entirely computer-generated and therefore robotic sounds that are used in many versions of text-to-speech software now on the market.

Now, aided by the declining cost and increasing speed of microprocessors, far smoother sentences are possible, Dr. Rabiner said. He said that the speech team at AT&T Labs, led by Dr. Juergen Schroeter, an expert in speech synthesis, had created a more refined form of the concatenative technique by breaking a person's voice into ''the smallest number of units possible.''

A demonstration of the technology will be available on the Web beginning today at www.naturalvoices.att .com, said Michael Dickman, a spokesman for AT&T Labs.

Still, many engineers are skeptical of claims of a completely simulated voice that is almost indistinguishable from that of a human. ''The methods and algorithms that we know of, they still need a lot more work,'' said P. S. Gopalakrishnan, the manager of the pervasive speech technologies group at I.B.M. Research, which competes with AT&T Labs in the field.

Now the pressure is on to perfect the technology. Analysts at McKinsey & Company, a management cosultant, have predicted that the market for text-to-speech software will reach more than $1 billion in the next five years. In addition to customers like call centers and manufacturers of automated voice systems, the software could also be used by publishers of video games and books-on-tape and automobile manufacturers whose cars are equipped with software that gives driving directions. In the near future, engineers expect that people will want high-end speech technology that enables them to interact at length with their cell phones and Palm organizers, instead of typing on and squinting at a tiny screen.

AT&T Labs' speech technology will be the first product that is actually sold by the laboratory, which is typically a research and development division. So far, the laboratory has hired three actors -- two male and one female -- to provide the voices that it will sell separately from the ''custom voice'' option. Mr. Dickman said that the company planned to recreate other voices, too, such as that of a child and a grandmother. Spanish-language voices are expected in a few months.

One of the voices is based on that of an African-American actor from New Jersey. (He and AT&T have requested that his name not be published because a clause in his contract stipulates that his identity is a company secret based on years of research and auditions.) He said the experience of being a ''voice donor,'' as he called it, was both stimulating and unsettling.