STEIN, AUTHOR of five novels (The Magician is the best known) has a reputation for keeping readers awake at night. In The Resort he once again proves his mastery over the thriller format.

The pacing is perfect as he introduces Henry and Margaret Brown. They are warm, loving and sympathetic. Thus, it is disturbing to see them check into Cliffhaven, a not-so-fun California hot spot. Cliffhaven is near Big Sur. It has redwoods, a beautiful coastline, a large swimming pool and a fantastic three-star restaurant. It also loves to cater to -- and eliminate -- Jews.

Despite sections where the action completely stops while new characters are introduced and slowly led on stage, Stein builds a believable horror. Reality slips away, as familiar figures -- gas station attendants, hotel clerks, highway patrolmen -- turn out to be participants in a monstrous conspiracy. The ultimate betrayal comes when a luxury hotel is revealed to be the front for a modern concentration camp, complete with kapos. Yes, it could happen here, Stein argues, and if it does it will be in ways you probably won't even recognize.

The Cliffhaven proprietor, a mini-fuehrer named Merle Clifford, is motivated to genocide by all those Nobel Prizes and other prestigious awards Jews have been winning. As a rationale, Clifford relies on a theisis that goes like this: back in medieval times the cream of the Christian crop joined monasteries and nunneries, never to procreate. Meanwhile, over in the Jewish ghettos, only the smartest men got to be rabbis and only the smartest women got to be rabbis's wives -- thus producing even smarter children. (In his acknowledgments, Stein thanks the real-life theorist responsible, for the use of his explanation "in a context he would abhor if it happened in real life.")

Stein fails only when he leaves familiar thriller terrain and starts to preach. Anti-Semitism is obviously terrible. But there must be a middle ground between unthingking idealism and Martin Brown's observation that "man could be a pig. Or a vulture. Under duress, a hyena." Such zoological metaphors make an extremely complex subject easy to understand, categorie and dismiss. For example, when Stein says that society is more concerned about forest fires than about mysteriously disappearing Jews, he forces the reader either to agree or to reject his entire thesis. Unfortunately, his simplistic emotionalism will thus encourage many readers to choose the latter. Stein himself eventually senses the need for subtlety. There's no clear-cut conclusion, and Henry and Margaret are forced to realize that, in the last resort, the fittest do not necessarily survive.