US CD sales rose by 2.3% in 2004 - the first rise in four years - despite the growing popularity of legal digital music downloads.
Usher was the biggest selling artist of the year
The CD format still accounts for 98% of the 666 million albums sold, according to research company Nielsen Soundscan.
A total of 140 million digital tracks were legally downloaded last year, equivalent to 14 million albums.
R&B star Usher was the biggest-selling artist with his album Confessions selling eight million copies alone.
Other top sellers of the year were Norah Jones, Eminem and country stars Kenny Chesney and Gretchen Wilson.
The US recording industry has attempted to tackle music piracy by suing those it believes are the worst offenders and closing down websites which offer music without permission.
Although it was slow to react to the problem the launch of services such as iTunes and the relaunched Napster has persuaded many to use the legal sites.
TOP FIVE US ALBUMS
1. Usher - Confessions
2. Norah Jones - Feels Like Home
3. Eminem - Encore
4. Kenny Chesney - When the Sun Goes Down
5. Gretchen Wilson - Here for the Party
Source: Neilsen Soundscan
The end of the year saw downloads reach a weekly high of 6.7 million tracks, up from 300,000 in mid-2003.
The use of download websites means consumers do not have to purchase entire albums but can chose only the tracks they like.
Downloads of whole albums has been calculated at 5.5 million copies, with rock band Hoobastank one of the most popular choices.
Nielsen Soundscan said the fastest growing music genres were Latin and country.
The UK recorded a record year for album sales in 2004, with 237 million sold in the 12 months up to September, an increase of 3%.
The Scissor Sisters proved the most popular album of the year, followed by Keane and Maroon 5.