LOS ANGELES - In the land of malls, one of Southern California's oldest indoor retail centers is no more.

Many of the boxy buildings at Huntington Beach shopping center sat boarded up despite sitting astride one of Orange County's busiest freeways. Now, the site plays host to one of the most extreme examples of a growing movement in mall design.

Noting the success of upscale, open-air shopping areas - "lifestyle centers" in mall jargon - the owners tore down the 1960s-vintage shell, and up sprang an airy shopping plaza with water fountains and a grassy amphitheater. The $170 million Bella Terra was born.

Lifestyle centers first arrived nearly two decades ago. But their success, even in cold climates, is now prompting traditional mall owners to invest millions of dollars in redesigns rather than new development. A shrinking number of major department stores also is spurring a change that is remaking the American mall.

In past years, a remodel may have included a paint job, new furniture, maybe marble accents. Not anymore.

"There's always been a need to update," said Anita Kramer, the director of retail development for the Urban Land Institute, a Washington, D.C.-based think tank dedicated to land use and development. "Just now the update is a whole new configuration."

The "de-malling" of the Huntington Beach mall isn't the norm. Most developers looking at projects from Seattle to Iowa aren't starting over but are adding "lifestyle" elements - outdoor streetscapes leading to existing entrances, destination restaurants and cinemas.

The redesigns are not cheap, and there's always a risk of misreading the market. Still, lifestyle centers are showing they can compete: They averaged $325 worth of sales per square foot of retail space in 2004, according to the most recent figures from the International Council of Shopping Centers. That's compared with $392 for enclosed malls in 2005.

Lifestyle centers have proliferated nationwide. They will number more than 100 by year's end, says CoStar Group Inc., which tracks data for commercial real estate professionals. That's nowhere near the 1,077 enclosed malls CoStar recorded, but the number of new enclosed malls is shrinking - from a height of 387 built in the 1970s to just 47 so far this decade.

Some lifestyle centers have become bona fide destinations. The Grove in Los Angeles often is credited with helping establish the viability of the lifestyle center.

"It's about the atmosphere, the decor," said Cherita McNeill, a 33-year-old aspiring actress , who was on a recent shopping trip to The Grove. "Not the same old look, the same old institutional feel. There's life out here."

Unlike classic malls, the Grove wants patrons "to shop, be entertained, to dine, but also to go hang out with friends," said Rick Caruso, the chief executive of Caruso Affiliated, which owns The Grove. "The days of putting one department store at each end and tenants in the middle are long gone."

The department store industry is accelerating change. Last year's $11 billion merger between Federated Department Stores Inc. and May Department Stores Co. has provided a rare opportunity, as Federated - the owner of Macy's and Bloomingdale's - try to shed duplicate stores.

The Westfield Group, the owner of 128 shopping centers worldwide, recently announced it was acquiring 15 stores from Federated, with plans to knock some down and replace them with outdoor entry plazas and exterior-facing storefronts. Although it means a loss of rentable space, Westfield hopes the outdoor element will help draw shoppers.

"We're having great fun with it," said Kenneth Wong, the president of Westfield's U.S. division, "and we're having great success with it."

As part of a major redevelopment outside Seattle, General Growth Properties Inc. opened up an entrance to its Alderwood Mall, creating an outdoor plaza with restaurants and shops.

"We shouldn't be doing the same look architecturally or otherwise that we did 20 years ago, let alone 10 or even five years ago," said General Growth CEO John Bucksbaum.