Dave McNally, a star pitcher who took part in the 1975 labor grievance that created free agency in major league baseball, died Sunday at his home in Billings, Mont. He was 60.

The cause was lung cancer, his family said.

McNally, a left-hander, won at least 20 games for the Baltimore Orioles every season from 1968 to 1971. McNally, Jim Palmer, Mike Cuellar and Pat Dobson each won at least 20 games in 1971, a feat that four teammates had not accomplished since the Chicago White Sox rotation of 1920.

McNally had 184 victories in 14 seasons and once shared the American League record for consecutive victories, with 17. He pitched on four Oriole pennant-winners, two of them World Series champions. He was a three-time All-Star and hit the only Series grand slam by a pitcher, against the Cincinnati Reds in 1970.

But what happened at the end of McNally's career resonated far beyond his pitching achievements.

In the 1975 season, McNally, having been traded to the Montreal Expos after 13 seasons with Baltimore, and Andy Messersmith, a pitcher for the Los Angeles Dodgers, were the only major leaguers who had not signed new contracts. McNally, upset over Montreal's salary terms, played under his old contract. He remained with the Expos until June, then left them after posting a 3-6 record, planning to retire. Messersmith, who declined to re-sign with the Dodgers because they had rebuffed his demands for a no-trade clause, was 19-14 with the Dodgers in 1975.

At the time, baseball teams controlled their players through a paragraph in each contract that permitted the club to renew it the next season even if the player refused to sign again -- the so-called reserve clause, which dated to the 19th century. By controlling players until choosing to trade, sell or release them, or until they retired, the owners kept salaries in check.

When the 1975 season ended, the players association, under Marvin Miller, persuaded McNally and Messersmith to file grievances seeking to overthrow this system. The union, through the two pitchers, argued that a contract could be renewed for only one year, and that afterward a player was free to sign with any other club. This challenged the owners' claim that contracts could be extended indefinitely, a year at a time.

On Dec. 23, 1975, Peter M. Seitz, baseball's arbitrator, agreed with the union's interpretation of the standard contract, finding that McNally and Messersmith, by refusing to re-sign, had indeed become free agents who could sell their services to the highest bidder.

''I am not an Abraham Lincoln signing the Emancipation Proclamation,'' Seitz said.

But the decision had enormous consequences. Although the owners fired Seitz immediately afterward, management and labor worked out a system giving players free agency after six seasons. With talent going to the highest bidder, the average annual salary rose from $44,000 in 1975 to $2.38 million at the start of the 2002 season, according to The Associated Press. Clubs could attract stars rather than build through their farm systems.

In his memoir, ''A Whole Different Ball Game,'' (Birch Lane Press, 1991), Miller wrote that McNally and Messersmith's ''willingness to challenge the reserve clause -- what many called 'the backbone of the game' -- led to the most important arbitration decision in the history of professional sports.''

Messersmith signed a multiyear contract with Atlanta after the arbitration ruling. But McNally retired, having posted a 184-119 record with a 3.24 earned run average. His 17 straight victories, which had matched the feat of Cleveland's Johnny Allen in the 1930's, remained an American League record until 1999, when the Yankees' Roger Clemens eclipsed it with 20.

McNally later owned an auto dealership in Billings.

He is survived by his wife, Jean; two sons, Jeff, of Salt Lake City, and Mike, of Billings; three daughters, Pam Murphy, of Billings, Susan Lisi, of Walnut Creek, Calif., and Anne Anderson, of Leander, Tex.; two brothers, Jim, of Billings, and Dan, of San Bernardino, Calif.; his mother, Beth, of Billings; and eight grandchildren.

Two years ago, McNally was perplexed when shortstop Alex Rodriguez signed his record 10-year, $252 million contract with Texas.

McNally told The Billings Gazette: ''My first thought when I saw that was: Did Texas offer him $250 million and he wanted two more? How did they get to $252 million?''

David Arthur "Dave" McNally