Three words you should never use around Daryl Hall: blue-eyed soul.

"It's time to finally put that term to rest," Hall insists one afternoon during a break in rehearsals for Hall & Oates new tour, which arrives at the Palace Theatre in Albany on Tuesday. "It's an archaic, racist term, OK?" Since Hall and his steady partner, John Oates, landed on the pop charts in the early 1970s with smart, harmony-filled hits such as "She's Gone," "Sara Smile" and "Rich Girl," the label "blue-eyed soul" has stuck to the Philadelphia natives like a smattering of Cheez-Wiz on a pile of shredded steak.

They don't like it. What's wrong with a couple of white boys possessing some soul -- especially when one of them is gifted with a falsetto as smooth and powerful as Hall's?

"He's an amazing singer," says Oates. "I stand next to him on stage and it's like, `Wow.' "

The two first bumped into each other -- literally -- in 1967, when they were students at Temple University in Philadelphia. After a fight erupted at a dance party where they were playing in separate bands, the pair collided when everyone ran for cover. The chance encounter set the stage for a musical collaboration that turned into the biggest-selling pop duo in music history.

After modest success in the 1970s, including the No. 1 hit "Rich Girl," the pair really took off in the '80s, racking up five more number-one hits ("Maneater," "Kiss on My List," "Private Eyes," "Out of Touch" and "I Can't Go For That"). In the early days of MTV, they were the channel's darlings (even though a few of their videos, such as "Jingle Bell Rock" and "Adult Education," rank among the worst ever).

They played historic events such as Live Aid and Farm Aid. They shared the stage with two of their boyhood heroes, David Ruffin and Eddie Kendrick of the Temptations, in a memorable show at the Apollo Theater. Hall also squeezed in three solo albums, one of which produced a top-five hit, 1986's "Dreamtime."

Then the 1990s arrived, and suddenly the tall, blond Hall and the short, dark-haired Oates were no longer the life of the party.

Sales slumped as radio tastes shifted first to grunge, then hip- hop. There was little room for two white guys singing simple pop songs. They kept working, but they seemed to have lost their chart mastery. The decade wound down with the 1997 release of "Marigold Sky," a solid album -- featuring the overlooked gems "Throw the Roses Away" and "Promise Ain't Enough" -- that nonetheless starved for air play.

Now the duo is back with their 21st album, "Do It For Love," a smart, breezy collection of pop-soul tunes that ranks with some of their best stuff.

Work on the album began a couple of years ago in England. A few tracks were recorded before the pair decided to break ties with their label, Sony.

"We're not a young group to be molded and pushed and turned into a commercial entity," says Oates, who lives in Aspen, Colo. "They wanted us to be something we weren't."

Determined to do it themselves, the pair returned to New York, reuniting with their longtime producer and bassist T-Bone Wolk. They also brought in an old friend from Philly, Todd Rundgren, who produced their 1974 album "War Babies." The trio blends beautifully on a cover of the New Radicals' "Someday We'll Know."

They put the album out on their own label, U-Watch Records. With the help of VH1's "Behind the Music" and an accompanying greatest- hits record, Hall & Oates are back on the charts.

The title track from "Do It for Love" made it to number one on the adult contemporary chart; the follow-up, "Forever For Love," is climbing the top 10.

"To have a hit record with no record company is pretty cool," said Oates, who called the split with Sony a "blessing in disguise."

Hall, who has a home in Dutchess County, is equally pleased with the results. "I like the mood of this record," he says. "It's close to our live performance." He's particularly thrilled with the way the song with Rundgren turned out, and notes that the soulful "Heartbreak Time" "could have been on any of our records."

Both men know the road back will be tough. The music business -- engineered for the quick score by the fresh face -- has changed. Hall views most music on the radio today as "junk."

But Oates says the duo is in perfect position to prove that a couple of guys in their 50s can buck the system and put out good music. So what if the result is only obvious on the adult contemporary charts?

"The dinosaur is falling to its knees," he says of the way the music business operates today. "We're adults and we're contemporary. Young artists would love to be on our charts. The music industry thinks it's all youth, youth, youth. That's a mistake." FACTS:BACK IN TOUCHHall & OatesWhen: 7:30 p.m. TuesdayWhere: Palace Theatre, 19 Clinton Ave., AlbanyInfo: 465-4663Tickets: $37.50- $43.50