Ellen French stared through the gates outside the Second Avenue Deli, searching for an explanation. “It’s closed,” she said. “It’s unbelievable. I can’t believe it.”

A city resident for 30 years, Ms. French was one of many New Yorkers wondering about the fate of the East Village landmark yesterday as they strolled under its blue awning on Second Avenue at 10th Street. The kosher deli has held that location since 1954.

The restaurant closed on Sunday amid a lease dispute between its owner, Jack Lebewohl, and Jonis Realty of Great Neck, N.J., which bought the building at 156 Second Ave. in August, along with several other nearby buildings.

The deli’s current lease runs for five more years, and Mr. Lebewohl wants to negotiate a longer-term contract at a lower rent. He claims he needs the new deal so he can afford to make renovations that he says are necessary for the restaurant to comply with Board of Health regulations.

The two sides have been negotiating for months, Mr. Lebewohl said. He said he had told the company all along that without an agreement, he would close the restaurant on January 1. The new year passed with no agreement, and the deli shut down at midnight Sunday.

Jonis Realty declined to comment yesterday.

Mr. Lebewohl, 57, is still waiting to hear from the company. Without a longterm lease agreement, he says, the Second Avenue Deli will not reopen.

“It hurts,” he said. “I feel bad. They feel bad. Hopefully, the situation will be resolved.”

In the meantime, Mr. Lebewohl said he’s received calls from more than 20 brokers offering new locations for the deli. All options remain open, he said, including moving or selling the restaurant.

Even if the deli’s location changes, its famous name will not. “It’ll be the Second Avenue Deli wherever it is,” Mr. Lebewohl said.

To many East Village residents, the deli’s uncertain future reflects a trend in the neighborhood, where longtime fixtures have closed recently rather than face escalating rents. The Bowery club CBGB will close in October, and the Bottom Line nightclub on East 4th Street shut down in 2004.

“One by one, all the good things go,” an East Village resident for nearly 25 years, Roberta Schine, said. “It’s sad. The developers move in, and the life of the place moves out.”

The Second Avenue Deli’s legacy extends beyond its corner perch at 10th Street. The park across the street is named for the deli’s founder and namesake, Abe Lebewohl, who was shot to death in front of the restaurant in March 1996. A poster advertising a $100,000 reward for information leading to the arrest of the killer still hangs on the deli’s front door.

For its loyal patrons, the deli’s demise means the loss of monstrous pastrami sandwiches, potato latkes, and matzo ball soup. Some said they will now turn to Katz’s, the popular Lower East Side deli on Houston Street, but others said the Second Avenue Deli was irreplaceable.

“They make the best sandwiches,” a frequent patron who lives around the corner on 10th Street, Debbie Vasquez, said. “They give you one, and you can make two.”

Ms. Vasquez’s husband, Louie Cabrera, has lived in the neighborhood for 45 years, and he said his father used to take him to the deli. “We used to raid this place at least twice a week,” Mr. Cabrera said.