IT IS A PARADOX that while the Holocaust has become an important resource for publishers and academics and a symbol for virtually every persecuted group in this century, few writers have been able to surmount the tremendous emotional, intellectual and technical problems it poses.

Some have failed because in trying to remain "disinterested they have cut themselves off been unable to distance themselves enough and have fallen into rhetoric and sentimentality. Writers who did not themselves live through the war often produce books that are impeccably researched and well written but unconvincing; Holocaust survivors who are not themselves writers often lack the skill necessary to communicate their experience. Both here and abroad, historians, philosophers, theologians, political scientists, psychiatrists and literary critics continue to apply their training to the events of the Second World War, but few reach beyond the constituents of their discipline to a general audience.

It is in this context that The House on Prague Street sparkles like a tiny gem. This slim book by a professor of Czech language at Yale is part autobiographical novel, part chronicle of the last years of a society which no longer exists. It offers up no theories, no clear-cut villains or heroines but a group of ordinary people -- Germans, Jews, Czechs, Slovaks -- who are forced during the years of 1933-1945 to make one difficult choice after another. Some of the choices appear trivial (shall a Jew affix his or her yellow star with a safety pin or sew it on with tight stitches?), some crucial (shall an Aryan protect his or her job and divorce a Jewish spouse, or lose the job and try to protect the spouse?), but all provoke a storng response in the reader. This book is so artfully constructed that without a single explicit reference to mass murder and only a few allusions to public figures or events, the reader is made to feel and understand the comprehensive and corrosive power of Nazi Germany.

Author Hana Demetz views the ear through a triple lens. Born in 1928 to a German father and a Jewish-Czech mother living in Czechoslovakia, she belongs to that small group of survivors who were "half castes of the first degree" under German law, who were children when the war began and teenagers when it ended. The House on Prague Street describes the same years as Elie Wiesel's Night, Jerzy Kosinski's The Painted Bird and Ilse Aichinger's Herod's Children, which are set respectively in Hungary, Poland and Austria. But Demetz's book, which was first published in Germany in 1970 (much later than the others), is written with an understanding made possible only by the passage of time. It reads like a folktale: straightforward, clean, musical. Every detail is there for a reason, and it is the accumulation of these details and their resonance in an inexorably destructive setting that makes the writing so alive.

"I still have dreams about the old house," Demetz begins. "I can see everything quite clearly: the three steps leading to the glass verandah, the yellow front door with its brass trim, the hallway where every step resounded even if I walked on tiptoe. . . . My mother and her two sisters grew up in the old house. My mother was the eldest. Zdena, the middle sister, had been a twin, but her little brother was born dead. It took my grandfather a long time before he forgave my grandmother this dead son."

Demetz moves quickly into the life of a small Bohemian town where several generations, classes and religious groups constitute an orderly whole. Her grandfather runs a prosperous transport business, tends a strawberry patch and rules his family with an iron hand. Her grandmother, whom he had married "for her gentle, quiet ways, since he had no need to marry for money," supervises the chauffeur, cook, drivers and maids. Her mother has married a law clerk, "a German student whose knowledge of Czech barely sufficed to let him pronounce her name" and her father, a tall, blond former army lieutenant has exchanged his dream of a private law practice for a civil service post in order to support his family. Each July on Grandfather Loewy's birthday, the entire family arrives at Prague Street: two uncles from Warnsdorf, their wives, chauffeurs, maids and Pekinese; three aunts from Aussig who behave like young girls; a pompous uncle from Prague. In the morning, the town mayor, hospital director and choral society leader pay their respects; at noon, dinner is served. "The Pekinese was banned from the dining room on grandfather's orders. The soup with liver dumplings was a poem, said the Prague banker uncle every year, and the goose . . . was a true symphony."

On the first such birthday that we witness, "The gentlemen retired to the living room for coffee, and my father was questioned extensively about the frightening events that were taking place in Germany. Everyone nodded gravely and worriedly. They did not relax until grandfather passed around his cigar box saying, 'Such things would be utterly impossible in this country.' Then they settled back into their blue clouds of smoke."

We return each July to Prague Street as Helenka Richter arrives to spend summer vacations with her grandparents, and it is through her eyes that we see Nazism erode its foundations.

But that is only half the book. While we watch the disintegration of the Loewy family, we watch Helene Richter grow up. Like most adolescents, she has problems with her body, her parents, her girlfriends, teachers, boys -- problems that are intensified by the war. She must change schools twice: first, because her father is forced out of his job and finds another in Prague; then, because she is thrown out of school for being half-Jewish. At her third school, she falls into the adulatory friendship so characteristic of teenage girls but must cope with the fact that although half-Jewish, her best friend attends meetings of the Nazi Girls Union and is in love with a German army captain.

At home, she watches her formerly extroverted father lose his enthusiasm for food, convention and the future, spending his hours in solitary games of chess. She watches her mother trying to stretch the buying power of three ration cards (two marked 'German' and one marked 'Jew') so that she can feed her husband and daughter, as well as send packages to the people of Prague Street who have all been deported. She watches the neighbors, many of whom live in mixed marriages, cope with the ordinary strains of life made heavier by occasional Gestapo raids, informers, physical and psychological degradation.

In this environment Helene Richter tries out and casts off ideas, career plans, sexual experiments and social values. After some awkward attempts at wartime dating, she falls in love with a German army lieutenant who retrieves her cap in the street and whose attentions not only throw Helene into profound confusion but create an impenetrable wall between mother and daughter.

None of the central characters that we come to care about is shown in extermination camps or killed in heroic resistance attempts, but by the end of this progressively more powerful novel, all but Helene and her childhood nurse are dead, casualties of Nazism. That this book is shocking without being sensational, and distanced without being detached, a is a tribute not only to a gifted writer but to an adult who has mastered her experience.