The American Catholic Church today is the nation's largest, and probably wealthiest, single denomination. It is represented more broadly in the governing councils of the states and the nation than any other religious group. Its dioceses and orders hold major blocs of stock in major corporations. The church stands with such titans as General Motors, the AFL-CIO and the Democratic Party in the pantheon of powerful national institutions.

How has a dogmatic institution that demands absolute fealty to the dictates of a spiritual ruler in Rome -- wrapped in the modes and forms of a medieval court -- thrived in this nation founded on the principle of freedom of thought, in rebellion against a foreign monarchy?

How did American Catholics, a minority in Protestant America, move from the isolation and rejection that was their lot for so many years to prosperity, lodging themselves firmly in the social and political mainstream?

A measure of how far the Catholic church has come here is that today, its major struggle is with itself -- a struggle to sort out the conflict and defections that have resulted from an end of rapid change. Now, just as any attacks on a bishop's authority are more likely to come from the clergy and laity of his own diocese than from outside, a sizable proportion of the millions who turned out this week to see Pope John Paul II are Catholics who flatly refuse to obey papal directives on birth control and divorce.

Still, the church is in better shape here than in many other nations. With roughly 50 million members, the American church ranks third (behind Brazil and Italy) in numbers among Rome's congregations around the world, and its real estate holdings, securities and firmly established tradition of weekly collections almost surely rank it first in wealth. At the birth of the nation, few would have predicted such growth. In 1776, there were about 20,000 Catholics, almost totally cut off from positions of governmental or social leadership among the 2.5 million residents of the 13 colonies.

The English colonies were the only sliver of New World soil where Catholicism had failed to take root. The church had come to this hemisphere in 1492 aboard Columbus' ships, and over the next two decades the explorers, soldiers and priests who built New Spain and New France had established a chain of missions across the two American continents. But in the English settlements, English anti-Catholicism was the rule, and several of the colonies adopted milder versions of the Penal Codes that had made Catholicism virtually an outlaw creed in Great Britain.

When the colonists broke with England, though, and formed a nation of their own, they had no taste for any form of official persecution of religious belief. Faced with a pluralistic society that had been built by religious refugees of many faiths, and steeped in the principles of the Enlightenment -- including the belief that each person had a right to worship his own God in his own way -- the foundaing fathers determined on both practical and philosophical grounds that this would be a place where the state would not interfere with the individual conscience.

When this principle was set down in the First Amendment, it marked a bold new experiment: No other government in history had ever committed itself to an enforced separation of church and state.

For the Roman Catholic Church, the idea that it would be left alone by a government was also something quite new. The church had enjoyed official support in some places and endured ferocious official hostility in others, but it had never functioned in an atmosphere were temporal authority was indifferent to its work. The Catholic hierarchy could not help but wonder if the guarantee of religious freedom would indeed be honored -- and, if it were, what would happen to the church.

Early on, the new federal government went out of its way to hold scrupulously to the First Amendment's command.

When Jefferson bought the Louisiana Territory in 1803, Catholic institutions there, established under the authority of the king of France, asked Washington what their status would be under the dominion of an overwhelmingly Protestant nation. In a letter to the sisters of a cloistered convent in New Orleans, Jefferson made it clear that their status would not be the government's concern. "The principles of the Constitution," the president wrote, "are a sure guarantee to you . . . Youg institution will be permitted to govern itself according to its own voluntary rules, without interference from the civil authority."

Was the church as willing as the government to live by the rule of the First Amendment?

For the laity, in particular, the answer was largely yes. But for the clergy -- traditionally drawn heavily from the Irish, whose native land is the home of the most politicized church in Europe -- The distinctions have not always been easy. Powerful prelates like Cardinals Spellman and Cushing became, undeniably, political figures, developing ties to the political hierarchy that could make many senior party leaders envious.

Perhaps for this reason, the Vatican long seemed uncertain about the relationship between the American church and the U.S. government. As late as 1960, when John F. Kennedy was battling hip and thigh to convince the electorate that a Catholic could serve as president without becoming a pawn of Rome, some functionary in the Vatican suggested, with excruciatingly bad timing, that the church had doubts about Kennedy's views on church and state. "Now I understand," Kennedy cracked, "why Henry VIII set up his own church."

Overall, however, the members and the leaders of the Catholic Church here have been able to work out a rough sense of accommodation over which social questions should be left to Caesar, and which require reference to God. As a result, conflicts over church-state problems are minimal today. The shining example, perhaps, is the resolution of once-bitter disputes over public aid to parochial schools. Twenty years ago, social chroniclers saw in that question the potential for open religious combat among political figures. Today, most Americans are barely aware that the controversy ever existed.

And today, most Americans who have thought about the subject agree that the separation of church and state has been a considerable boon to the church. "The church has flourished here in ways she never did in other countries," says Msgr. John Tracy Ellis of Catholic University, the dean of American church historians. "The freedom from interference in the choice of bishops, the freedom to use its resources as the church alone sees fit to do -- the whole situation in this country has been one in which the church could thrive. And it did."

Lacking some of the governmental "benefits" it enjoyed in Catholic Europe, the church here was forced to fend for itself, which explains some of the unique aspects of the American branch of the Roman church.

Because Americans were so insistent that every shred of religious teaching be removed from the public schools, the church felt the need to start schools of its own -- and built the largest private school system on earth. Because the hiearchy here knew it could not expect the kind of official beneficience it had known in Europe -- royal tithes, land grants, government stipends for priests -- the American church, from its earliest days, learned to depend on its laity for financial support, which has been so steady and so generous that the American church is today the best-endowed arm of the universal church.

How wealthy is the American Catholic Church? The question, although frequently asked, is somewhat misleading because the church's holdings are scattered among hundreds of diocesses and orders: There is no central bursar.

It's probably safe to say, however, that the church's holdings have a total value in excess of $50 billion, about 90 percent of it tied up in real estate with the remainder in cash and an imposing portfolio of securities.

The most important benefit of the separation of church and state here, however, was that it left the church free to grow without the hindrance of official interference. And its growth -- from a nearly invisible fraction of the population in 1776 to a quarter of the nation today -- is the most spectacular aspect of the church's American history.

The Catholic Church grew, as the nation did, through immigration. During the century long period, roughly 1825-1925, when the American melting pot was operating at peak capacity, millions of Irishmen, Italians, Poles, Greeks, Germans and other national groups entered the United States -- and entered, at the same time, the bosom of the American Catholic Church.

Most of these immigrants brought their faith with them; but the church here saw to it that the faith was kept alive and passed on to the next generation.

For the church was not only pastor and teacher for the immigrant millions -- it served as the new American's bulwark against the vicissitudes of life in a hard world, as well. In an age before the Welfare State, the church provided the kind of cradle-to-grave support that comes today from government: Hospitals, schools, orphanages, soup kitchens, asylums and cemeteries were available to the American Catholic -- and if he couldn't pay for the service, it was still available.

Less formally, the city pastor provided other kinds of help as well; he was, as the need arose, banker, employment agency, doctor, psychiatrist and arbiter to his parish.

As a result, the church held the loyalty of its flock long after the Irishmen, Italians and so forth had become thoroughly American. As the second and third generations multiplied, and new waves of immigrants arrived at the church's door, the Catholic proportion of America's population began to climb sharply. In the 1890 census -- the first in which the Catholic bloc was large enough to warrant a separate count -- Catholics represented 13 percent of the nation. In 1930, the figure was 18 percent; by the time of the special religious census in 1957, 26 percent of all Americans were Catholic, a figure that has held fairly steady for the past two decades. Although the United States today is still predominantly Protestant, the Roman Catholic Church has more members than any single Protestant denomination.

The church today reflects its immigrant roots quite clearly: It's still ethnic and urban centered -- a map would show most Catholics clustered around the major industrial cities, particularly in the Northeastern megalopolis. And the church is still open to immigrants: Its fastest-growing sector is the Hispanic church, which today makes up about 25 percent of its total membership.

But while the church was able to build its schools and its treasury and its membership free of official interference here, Catholics in this country have had to endure some of the most vicious and widespread anti-Catholic bigotry ever experienced anywhere. The history of the church here is, to a considerable extent, a history of its efforts to overcome the organized hostility of such private groups as The Order of the Star-Spangled Banner, the American Protective Association and the American Protestant Association, as well as a generalized prejudice that shut the gates of social, political and professional attainment to millions of Americans because of their attachment to Rome.

American anti-Catholicism was, to a degree, a byproduct of American nationalism; the Catholic, after all, was the foreigner. Prejudice stemmed as well from fear of the mysterious; it was not at all hard to believe that the local parish, with its smoking incense and weird Latin incantations, and its open allegiance to a Roman court, was up to no good. In addition, a perceived arrogance of Catholic doctrine fueled the hatred: The Catholics' insistence that theirs was the "one true faith" and that practitioners of any other were to be deemed "in error" hardly served to sweeten relations between the urban Catholic and his Lutheran or Jewish neighbor.

The startling thing, from today's vantage point, is that a fairly ferocious stream of anti-Catholicism survived in this country almost until the present.

As late as 1949, a free-lance writer named Paul Blanshard earned himself several months on the best-seller lists with a work (labeled "nonfiction") setting forth "The Catholic Plan for America" -- a plan that included, Blanshard said, seizing the government, repealing the First Amendment, outlawing divorce and making the pope the president's official superior.

It's not always easy to discover a single watershed that ends a long phase of history, but in the case of American anti-Catholicism, such a watershed does seem to exist -- the election and presidency of John F. Kennedy.

By electing the nation's first Roman Catholic president -- after a campaign in which the candidate's religious faith was a major issue -- the American people demonstrated that they were no longer susceptible to the pull of bigotry. And by steering well clear of any suggestion of church-state conflict during his term in the White House, Kennedy laid to rest, probably forever, the suggestion that an American Catholic officeholder would be plagued by divided loyalties between his country and his church.

This is not to suggest, however, that the years since Kennedy's election have been an altar of roses for the Catholic Church in the United States. Quite the contrary, in fact -- the past two decades have been a period of almost constant turmoil for the church here. The difference is that the current trials stem from developments within the church itself -- primarily from a historic series of church meetings that began while Kennedy was in the White House: the Second Vatican Council.

The decisions made between 1962 and 1965 at Vatican II were not restricted, as many gatherings of the world hierarchy had been, to obscure questions of metaphysical doctrine. The reforms begun with the council have reached down into every parish and touched the daily life of every Catholic family.

As a result of the Vatican sessions, Catholics were asked to revise concepts and practices of their faith, that had always seemed as immutable as the multiplication tables:

It was no longer a sin to eat meat on Friday.

Confession no longer meant rattling off one's sins in a dark, anonymous booth, with the assurance of absolution in return for reciting a given number of rote prayers. Now penitent met priest across a desk in a quiet reconcilation room and discussed specific remedies for specific faults.

Nuns donned mini-skirts and moved out of the convent into antiwar protests in the streets and landlord-tenant battles in the ghetto.

Priests exchanged Roman collars for sports shirts, organized unions and demanded the right to marry. When the hierarchy refused, the dissidents laid down their priestly orders by the hundreds. Even one bishop, the widely respected James Shannon, forsook the priestly life to take a wife.

For the average Catholic, Vatican II was felt most immediately on Sunday morning, when major changes began to appear in the ancient liturgy. The mystic sonorities of the Latin mass, a ritual that had linked every modern Catholic to the very beginnings of the church, were abruptly laid aside. Priests turned around to face the congregation, and delegated some of their traditional tasks to lay men -- and women. For older Catholics particularly, the unpredictable new mass with its communal "kiss of peace" and its endless variations -- for the mass could change from week to week in the same parish -- was a grating contrast to the quiet ceremony of introspection and personal prayer that the Latin mass had been.

The concept of the laity was changed as well. After being told for generations that their functions were mainly passive -- "pay, pray, and obey" was the derisive shorthand -- the laity was now directed to "share responsibility" with the clergy for the direction of the church.

The operative word of Vatican II became "collegiality" -- shared decisionmaking between people and priests, priests and bishops and bishops and pope.

To implement these new relationships, the church developed parish councils, priests' senates at the diocesan level and, to advise the pope himself, a synod of bishops that met every two or three years.

Collegiality notwithstanding, the church did not turn into an overnight democracy. Despite the call for shared responsibility, both tradition and church law upheld the priest as the final authority in his parish, just as the bishop was in the diocese. As "the people of God" sought to work out the new relationships, conflict inevitably developed.

These strains within the church were increased by rapid developments in the surrounding American society. The descendants of the original immigrant Catholics were graduating from Notre Dame, Fordham and even Princeton and Yale, and moving into an upper-middle-class milieu whose values were not always those of the church. Catholics were torn between a modern culture that accepted birth control, divorce, sexual equality and abortion, and a church that rejected these notions. Just how deep the emotional conflict went is reflected in a Gallup Poll released earlier this year. On three major issues, the survey found the majority of Catholics closer to the cultural mainstream than to the teachings of their church:

69 percent said Catholics should be permitted to divoce and remarry in the church;

73 percent felt Catholics should be allowed to practice "artificial" means of birth control;

44 percent wanted the church to relax its standards forbidding all abortions under any circumstances.

Nothing in the recent history of the Catholic Church in this country stirred more controversy than Pope Paul's 1968 encyclical, Humane Vitae, reasserting the church's traditional ban on artificial methods of birth control. In the momentum of renewal and modernization already taking place in the Catholic Church, it was widely assumed that change would come here also.

The question came at a time of widespread euphoria over the discovery of the pill as a magic cure-all to problems of both family planning and worldwide population control; Beyond that, a commission of lay Catholics, doctors and theologians -- appointed by Pope Paul himself -- had overwhelmingly recommended reversing the church's traditional ban on contraception.

When, more than a year after the commission's report, the papal encyclical reiterated the traditional position, there was widespread dismay. Priests whose long hours in the confessional had sensitized them to the anguish of the faithful on this question rebelled openly, declaring that they would not enforce the encyclical. Catholic theologians said publicly that the pope was wrong. Protest demonstrations disrupted masses. Some bishops countered by suspending the dissenting priests, which, in turn, triggered more protests.

The people reacted in a variety of ways. Some accepted and defended the encylical, and when subsequent medical reports of the pill's side effects began to emerge, they praised the wisdom of the church. Some, unable to accept the teaching and disappointed by what they viewed as the church's unwillingness to understand their problems, left the church. Still others remained "loyal Catholics," while rejecting church teaching on this subject.

In a comprehensive study of American Catholicism five years ago, chicago priest-sociologist Andrew Greeley linked the encyclical to the Catholics who had left the church:

"A religious institution which could be so patently wrong on such a critical issue was judged to be wrong, or at least questionable, on a wide range of other related issues," he said.

But the turmoil of Humanae Vitae has had another effect in the shaping of American Catholicism, according to the Rev. Charles Curran, professor of moral theology at Catholic University, who led a revolt of theologians against the encyclical.

In a sympoisum looking back on Humanae Vitae 10 years after it was issued, Curran maintained that the encyclical "is important because for the first time in recent history it has been widely proposed and accepted that one can dissent from authoritative noninfallible hierarchical teaching and still be a loyal Roman Catholic."

Curran reiterated the position he took when the encyclical was issued. "The specific papal teaching condemning artificial contraception is wrong, and a Roman Catholic can dissent in theory and practice from such a teaching.The pope is in error, and we must honestly admit that the teaching is wrong," he said.

For views such as these, Curran and a number of other theologians who agree with him have been formally banned from some dioceses in the American church. But the fact that he can call the pope wrong and continue to teach at the only public university in this country chartered by the Vatican is evidence enough of a new openess in the Catholic Church today.

What has developed in American Catholicism in the years since Vatican II is a new process of discernment, in which some Catholics say: "I can disagree with the church's teaching on a given issue and still consider myself a good Catholic."

Disagreement usually comes on questions of sexual morality, where, as dissenters like to point out, the church's rules are made by an exclusively male, celibate magisterium.

The new dissent was dramatically illustrated by the 1976 Call to Action conference, the most broadly representative national gathering of "the people of God" ever held by the American Catholic church. Delegates to the conference -- nuns and priests as well as lay people -- adopted resolutions calling for changes in traditional Catholic teachings in such areas as birth control, divorce, ordination of women and homosexuality. The delegates, it should be pointed out, were all appointed by their local bishops to participate in the conference.

One of the most troublesome problems for American Catholicism is divorce. Church teaching holds that marriage is indissoluble, to be terminated only by the death of one of the partners. But American Catholics tend to get divorced in the civil courts at about the same rate as the rest of the population. And, like other people, the overwhelming majority of those who have divorced will remarry.

For Catholics, such a second marriage is considered by the church an "adulterous union," unless the first marriage has been annulled by church courts.

Although divorced and remarried Catholics are no longer automatically excommunicated, as they were up until a year ago, they still may not receive communion: The "gesture of love and reconciliation," as the bishops called it, was more symbolic than cannonical, and brought the American Catholic Church into conformity with the practice in other countries.

Some divorced Catholics are able to have their first marriages annulled. But despite special permission from the Vatican for streamlined procedures in the American church tribunals set up nearly a decade ago by the Canon Law Association, it has been estimated that fewer than 2 percent of the 8 million divorced Catholics in this country have succeeded in getting their cases through the tribunals.

The rest must cope as best they can without the solace of the church just when they may need it most. Some abandon the church, which they perceive as rejecting them; others cling all the more tenaciously to their faith.

In recent years divorced Catholics have begun to band together for mutual solace and support. Across the country there are more than 500 groups of separated and divorced Catholics who come together once or twice a month to lick one another's wounds and to shoulder jointly the pain of being divorced Catholics.

Yet despite the strains of recent years, the American Catholic Church has not shared the membership decline that has afflicted mainline Protestant churches. Except for a slight drop last year, the annual membership statistics reflect continued growth -- although continued declines in infant baptisms, adult conversions and Catholic marriages show some cause for concern about long-range growth.

What has not grown, however, are the ranks of the church's formal leadership -- priests, nuns and religious brothers.

The church has 52,000 fewer nuns today than it had in 1965, the year Vatican II ended. Many of the 128,378 who remain are at or nearing retirement age.

In the priesthood, the picture is bleaker still: While the church has almost exactly as many priests today as in 1965, church membership has grown by almost 9 percent in that same period. Even more alarming, seminaries have only a quarter of 1965's enrollment -- and the number of men who decide to study for the priesthood declines every year.

Traditionalists blame the reforms of Vatican II and the lack of church discipline for the loss of religous vocations. Liberals blame foot-dragging in implementing the reforms of Vatican II, Humanae Vitae and the requirement of celibacy. Both sides agree that the closing of more than half of parochial schools nationwide has also been a factor, cuttong off a traditional source of young people eager to serve the church.

But if the shortage of priests and nuns portends a crisis, it has also brought blessings. With a shortage of priests and nuns, lay men and women are increasingly taking over key ministries in the church. Lay men and women are teaching in parochial schools, once the exclusive domain of nuns. They take communion to the sick. They serve as missionaries overseas and in social service institutions in the ghettos. They staff parish youth programs and student ministries on university campuses.

In summary, then, the American Catholic Church that Pope Paul II has visited this week is a congregation that has settled into a secure and important position among the country's major national institutions, but it's one that's currently feeling somewhat unsettled within itself.

Still, any prognosis must be optimistic: When one recognizes the obstacles that Catholicism has overcome here over the past two centuries, it is hard to doubt that the church will emerge intact and healthy from its present time of trial, and that "the gates of Hell shall not prevail against it."