The Grand Casino's Island View Hotel was demolished Sunday to make room for a new resort on the waterfront property.

Workers used 400 pounds of explosives to take down the 12-story hotel, which housed 500 rooms, retail shops and a restaurant before Hurricane Katrina damaged the building nearly nine months ago.

Biloxi Mayor A.J. Holloway pressed the buttons to trigger the implosion shortly before 7 a.m. A crowd of more than 100 onlookers, watching from behind a chain-link fence, erupted in cheers as the hotel dissolved into a cloud of dust and a pile of debris.

"It's not the end of something," Holloway said of the hotel, which opened in 1995. "I think it's just the beginning of greater and bigger things to come on this location."

In mid-August, Harrah's Entertainment plans to open a new casino in a hotel across the street from where the Island View Hotel stood. Harrah's, which acquired Grand Casino Biloxi last year, is expected to announce its plans for the site of the demolished hotel late this summer.

Mississippi's Gulf Coast hosted 12 casinos before Katrina. Three casinos have reopened since the hurricane and at least five more are expected to reopen by the end of the year.