Sag Harbor - The torrential rain did not dampen the spirit of the evening as a small band of devotees gathered for drinks and dessert at designer Donna Karan's "Urban Zen" in Sag Harbor.

The pricey boutique located at 4 Bay Street in the heart of the Village just across the street from the Harbor was established in 2007. It is Karan's pet project. Urban Zen's mission is beyond clothes.

Bessie Afnaim, center, models one of Donna Karan's creations for Urban Zen. The dress retails for $995.

"The store is an extension of the Urban Zen Wellness program," manager Kevin Sayer said while the sun was still shining on Friday afternoon. The tranquil store, set in a vintage building complete with wide plank flooring, makes a perfect showcase for the understated luxury line merchandise. The gray clapboard exterior punctuated by large windows melds vintage Sag Harbor with a contemporary vibe.

The storefront windows provide light as well as a view of the harbor making the store a welcome addition to the historic minded village where citizens have resisted the onslaught of big box retailers on their streets. For the designer, the store is a way to blend into the community as she spreads her message of health and wellness as a way of life. The retail store is another way of helping Karan's Urban Zen Foundation. The foundation is committed to raising awareness and combining eastern and western medicine.

Karan's long standing interest in eastern philosophy came to the forefront after her husband, artist Stephan Weiss died of lung cancer in 2001 at the age of 62. Weiss played an important part in the formation of his wife's fashion empire. Karan described him as her muse and her inspiration. She formed the Urban Zen Foundation using her late husband's art studio on Greenwich Street in Manhattan's Greenwich Village as the headquarters for the wellness center after he died.

The foundation is dedicated to combining eastern philosophy with western medicine. Karan donated $850,000 to the Beth Israel Medical Center in Manhattan a few years ago to study the use of yoga, meditation and acupuncture as a means of helping cancer patients through their chemotherapy and radiation treatments. The goal is to minimize the side effects these treatments have on patients.

Karan was awarded an honorary nursing degree from the Beth Israel Medical Center's School of Nursing this year in June. The award was given in appreciation of Karan's contributions at Beth Israel. Patients as well as medical staff joined in the process. The goal is to provide a healing and relaxing atmosphere - much needed in medicine today where patients, their families and their health care providers are often stressed beyond their limits.

Donna Karan checks messages as Sonja Nuttall, Creative Director for Urban Zen looks on.

Karan arrived fashionably late for her own party dressed sparingly in a pair of olive green pants made from a woven fabric that looked like a cross between sack cloth and linen. Her coordinated wrap style blouse had Buddhist monk overtones. She wore gladiator style sandals and was oblivious to both the rain and the puddles outside her store. She splashed ahead, walking right through the pond sized puddles, as she came in and out of the shop several times. Her feet got wet and she didn't care as she achieved her own Zen moment.

Her hair was pulled back in a braided ponytail that heightened her unadorned simplicity. She chatted with guests and posed for photographs with her daughter Gabby. Mother and daughter are nearly inseparable. Gabby works for her mother and lives nearby both in the city and on the East End. For Karan, friends and family define her time in the Hamptons where she lives in a spacious, minimally furnished waterfront home that reflects her interest in eastern philosophy, mediation, and yoga.

The mood was festive inside the small retail space that quickly filled with guests and event photographers out to get a snap of the designer who began her career after she left the Parsons School of Design. Karan at the relatively young age of 25 went to work as a designer at Anne Klein, before starting her own company in 1983 with Weiss at her side. The well-known business dubbed DKNY was eventually sold to Louis Vuitton Moet Hennessy (LVMH) in 2000 for $450 million.

Karan arrived late for her own party, checked a few messages on her blackberry and worked the room as guests delighted in her presence and enjoyed the Zen that Urban Zen is bringing to Sag Harbor.

"Urban Zen" is not part of DKNY," Sayer said. "Both this store and the Urban Zen in the city are funded with Donna Karan's own money." The city store is downtown in Greenwich Village on West 10th Street between Charles and Spring Streets. Proceeds from the stores help fund the Wellness programs that mean so much to the designer. The clothes designed by Karan and sold at Urban Zen reflect a casual elegance intended to be timeless. The award winning designer does not believe in marketing clothes that she would not wear herself. One of her simple tests is the way a garment looks on her. If Donna can't wear it, no one else will either. The garment will not see the light of day or make it to the racks.

Early in her career Karan made a name for herself when she introduced her seven easy pieces to the market. The clothes were designed to provide women with clothes that were stylish and easy to wear.

Karan's softly draped yet intricately constructed garments became her distinctive design trademark as she perfected a look that was space age modern, yet somehow basically primitive at the same time. The look worked leaving the observer to decide if the designer was paying homage to "The Flintstones" or to "Star Trek."

"It's not about fashion of the moment," Sayer said of the designer's Urban Zen collection. "It's about creating a garment that people will love and wear again and again. These are clothes that you want to live in."

Customers at Urban Zen can spend freely with the knowledge that they are spending for a good cause in addition to treating themselves to something that will make them happy every time they reach into their closet for years to come.

In the words of the Urban Zen Foundation, "Dare to create, connect, collaborate, communicate and effect change."

"This is a challenging economy," Sayer said. "We are giving people a reason to spend money as well as a purpose."

The store is open seven days a week all year long.