The RIAA, a trade association for record companies, is still battling with Napster and MP3.com over copyright issues related to the distribution of its members' music over the Internet.
The deal is seen by observers as a positive step by the RIAA into the realm of Internet music.
Since October 1998, Yahoo has offered users access to online-music broadcasts under terms of the Digital Millennium Copyright Act (DMCA), the company said. The deal with the RIAA establishes new terms for distributing music under this licence, and includes music distributed from Yahoo's numerous broadcast points, including Yahoo Radio.
Hilary Rosen, president and chief executive officer of the RIAA, said: "Our agreement with Yahoo confirms that music on the Internet will thrive when parties work together."