The first highly controversial case of the new Supreme Court season was argued on Wednesday, complete with Americans on either side of the issue protesting on the marble steps outside.

Justices heard the Bush administration's appeal of a lower-court decision that affirmed a state law legalizing physician-assisted suicide (search). At issue was whether the federal government's regulation of controlled substances dictates how the state of Oregon may use them, regardless of what its voters want.

"The most natural reading of the [federal] Controlled Substances Act (search) is ... this falls within the authority of the attorney general," said Solicitor General Paul Clement, arguing on behalf of the Bush administration.

Oregon has the only law in the country — twice affirmed by voters — that allows physicians to prescribe lethal doses of medication to terminally ill patients who wish to end their lives. Other states including Hawaii and California have made moves toward similar legislation, and are certain to be watching the outcome of the case closely.

Chief Justice John Roberts did not hesitate to challenge attorneys in the first major case of his tenure, noting that the federal government's tough regulation of addictive drugs made Oregon's case dubious.

Roberts' predecessor, the late William H. Rehnquist, revived federalism in his time on the court and likely would have been sympathetic to Oregon Senior Assistant Attorney General Robert Atkinson's arguments. But the 50-year-old Roberts seemed skeptical of the Oregon law, and threw questions at Atkinson before the attorney could get through his first sentence.

Justice Sandra Day O'Connor (search) immediately challenged the government's position, asking if federal drug laws also prevented doctors from participating in the execution of murderers.

Justice Anthony Kennedy said he found it "odd" that the U.S. attorney general determined physician-assisted suicide to be an abuse of drug laws, when the state of Oregon strictly limited how the drugs could be administered and in what cases.

"I don't think it's odd," Clement replied, noting that federal laws regulating drug use have been in place for more than 90 years.

Still, Kennedy acknowledged it was "a tough case."

Perhaps complicating the outcome is the justices' personal battles with life-threatening illnesses. Three justices — O'Connor, Ruth Bader Ginsburg and John Paul Stevens — have had cancer, and a fourth — Stephen Breyer — has a spouse who counsels young, terminally ill cancer patients.

Their longtime colleague, Rehnquist, who once wrote about the "earnest and profound debate" over doctor-assisted suicide, died a month ago after battling untreatable cancer for nearly a year.

Seventy-nine percent of patients who chose physician-assisted suicide suffered from cancer, according to a March report from Oregon's Department of Health and Human Services.

Meanwhile, demonstrators outside carried signs saying "My Life, My Death, My Decision," while those on the government's side waved banners that read "Not Dead Yet."

"Oregon ought to be proud of having taken the first step," said one of the law's supporters, Rowland Cross, of Arlington, Va.

Among the spectators who tolerated long lines to witness arguments was Bobby Schindler. His sister, Terri Schiavo (search), died after a court-enforced order to remove her feeding tube was enforced. The case sparked a national debate and lengthy legal battle over right-to-die issues.

The Supreme Court repeatedly refused to hear Schiavo's parents' argument that the feeding tube should be reinserted.

In 1997 the court found that the terminally ill have no constitutional right to doctor-assisted suicide. O'Connor provided a key fifth vote in that decision, which left room for state-by-state experimentation.

O'Connor seemed ready to back the law allowing dying patients to obtain lethal doses of medication from their doctors. While she could provide the fifth vote in Oregon's favor, she will likely retire from the court before the case is decided. A 4-4 tie would be decided by a new justice.

Bush on Monday named White House lawyer Harriet Miers to replace her. If Miers is confirmed before a ruling is announced, O'Connor's vote will not count. A 4-4 tie would probably require the court to schedule a new argument session.

The appeal is a turf battle of sorts, not a constitutional showdown. Former Attorney General John Ashcroft, a favorite among the president's base of religious conservatives, decided in 2001 to pursue doctors who help people die.

Hastening someone's death is an improper use of medication and violates federal drug laws, Ashcroft reasoned, an opposite conclusion than the one reached by Janet Reno, the Clinton administration attorney general.

Oregon filed a lawsuit to defend its law, which took effect in 1997 and has been used by more than 200 people.

The Supreme Court will decide whether the federal government can trump the state.

"It could be close," said Neil Siegel, a law professor at Duke University and former Supreme Court clerk. "It is a wrenching issue. It's one of the most difficult decisions any family needs to make. There's a lot of discomfort with having the government at any level get involved."

Under Rehnquist's leadership the court had sought to embolden states to set their own rules. Roberts, who once served as a law clerk to Rehnquist and worked as a government lawyer, may be sympathetic to Bush administration arguments that the federal government needs ultimate authority to control drugs.

In this case, that would be at odds with the concept, popular among conservatives, of limiting federal interference.

Clement, the administration's Supreme Court lawyer, told justices in a filing that 49 states, centuries of tradition, and doctors groups agree that "assisted suicide is 'fundamentally incompatible' with a physician's role as healer."

The administration lost at the 9th U.S. Circuit Court of Appeals in San Francisco, which said Ashcroft's "unilateral attempt to regulate general medical practices historically entrusted to state lawmakers interferes with the democratic debate about physician-assisted suicide."

In Oregon, the first assisted-suicide law won narrow approval, just a 51 percent majority, in 1994. An effort to repeal it in 1997 was rejected by 60 percent of voters.

The case before the Supreme Court is Gonzales v. Oregon, 04-623.

FOX News' Jane Roh and The Associated Press contributed to this report.