· Sales of 7in singles rise by 13% in first half of year · New bands and collectors turning to old format

The format was supposed to have been badly wounded by the introduction of CDs and killed off completely by the ipod-generation that bought music online.

But in a rare case of cheerful news for the record labels, the latest phenomenon in a notoriously fickle industry is one nobody dared predict: a vinyl revival. Latest figures show a big jump in vinyl sales in the first half of this year, confirming the anecdotal evidence from specialist shops throughout the UK.

It comes as sales of CD singles continue to slide - and it is not being driven by technophobic middle-aged consumers. Teenagers and students are developing a taste for records and are turning away from the clinical method of downloading music on to an MP3 player.

The data, released by the UK's industry group BPI, shows that 7in vinyl sales were up 13% in the first half, with the White Stripes' Icky Thump the best seller.

Two-thirds of all singles in the UK now come out on in the 7in format, with sales topping 1m. Though still a far cry from vinyl's heyday in 1979, when Art Garfunkel's Bright Eyes alone sold that number and the total vinyl singles market was 89m, the latest sales are still up more than fivefold in five years.

For record stores, the resurgence has meant a move from racks of vintage Rolling Stones and Beatles releases to brand new singles and younger buyers. "The student population seem to be loving the 7in," says Stuart Smith, who runs Seismic Records in Leamington Spa, Warwickshire. He sells 300-600 records a week and is preparing to launch an online store.

"I'm still not sure about the MP3 generation. You can have a full hard drive and nothing to show for it. Record collections are very personal. You can view into a person's soul really," he says.

The customers rummaging through racks at his store, a small room above a skate shop, are students and DJs.

When Mr Smith opened the vinyl shop in early 2005, digital download sales were rocketing and, amid rampant piracy, global music revenues were several years into their current downward spiral.

A shop selling LPs and 7in singles didn't sound like the most promising business plan. But when his employers at the local outlet of music chain Fopp - now closed down - decided to stop selling vinyl it was something he couldn't resist.

"I just couldn't understand why they decided to turn their backs on it. I saw an opportunity to do something I love doing. I've been a collector myself for years," says the 31-year-old. "It's just one of things. It just felt right."

Two years on, the White Stripes' Icky Thump has just notched up the highest weekly sales for a 7in single for more than 20 years. Retailers and record labels put the rising vinyl sales down to bands rediscovering the format and to music fans' enduring desire to collect. It's not unusual for fans to buy a 7in but have nothing to play it on, says Paul Williams at industry magazine Music Week. "It's about the kind of acts that have very loyal fan bases that want everything to do with that act," he says. "They maybe will buy the download to listen to, but they get the vinyl to own. It's looked at like artwork."

HMV agrees that vinyl is back from the brink, and the chain has been rapidly expanding its record racks to meet rising demand. The group's Gennaro Castaldo cites the huge popularity of "indie" bands, such as Franz Ferdinand and Arctic Monkeys, which enjoy loyal followings among teenagers and students, especially during the summer festival season.

"Labels have realised that it's cool for bands to release their music on vinyl, especially in limited edition form, which makes it highly collectible," he says.

London company Art Vinyl has built a whole business out of the format's visual and tactile appeal by selling easy-to-open frames to display records and their sleeves.

For fans, buying and owning a record can provide a welcome change from the anonymity of online downloads, says Art Vinyl's founder Andrew Heeps. "If you go into a record shop to buy something, you feel part of something," he says. "The fact that last year we sold over 9,000 frames to people says an awful lot about where the market is going."

Cara Henn, a DJ and regular Seismic Records customer says going to the store puts her in touch with her peers and has hammered home the vinyl trend. "I've really been getting back into my vinyl. I love it," she says. "I like to hear crackling, as if it's actually real. Especially with drum'n'bass, DJs are really encouraging fans to buy vinyl."