ELLEN GILCHRIST is an exceptionally gifted writer whose first book of fiction, a collection of short stories called In the Land of Dreamy Dreams, immediately co bwfestablished her as someone of consequence. Both she and her publisher (the University of Arkansas Press) were almost entirely unknown when the book appeared in 1981, but a number of admiring reviews and some unusually enthusiastic word-of-mouth support gave the book a well-deserved boost; the collection has by now gone into its third printing, a rare accomplishment indeed in today's difficult market for a book of literary stories.

Most of them are set in the South, principally New Orleans--the "land of dreamy dreams" of Gilchrist's title. They are written in a clean, lucid prose that manages to be both whimsical and ironic without becoming merely cute or cloying. Their chief subject is domestic life among the bored, purposeless, self-indulgent and self-absorbed rich; the brutal realities that Gilchrist thrusts into these lives are chilling, and so too is the merciless candor with which she discloses the emptiness behind their glitter. Certainly it is easy to see why reviewers and readers have responded so strongly to Gilchrist; she tells home truths in these stories, and she tells them in style.

The American literary system being what it is, the small but noteworthy success achieved by In the Land of Dreamy Dreams was followed by two entirely predictable developments: Gilchrist wrote a novel, and she took it to a large trade publisher. The system calls for bigger, and Gilchrist has given us bigger; I am sorry to say that, to put it charitably, she has not given us better. Her new publisher has produced a handsome book for her and has given it the kind of sendoff to which a writer of her gifts is entitled. But these trappings cannot disguise the flabbiness of The Annunciation; it is a book with a good heart, but that heart is surrounded by layers of fat.

The first third of the book, though, is quite wonderful. As the novel opens Amanda McCamey, four years old, has moved with her widowed mother to Esperanza, the Mississippi plantation of her father's family. There resides her cousin, Guy, four years older: "Amanda and Guy. Amanda and Guy. The only white children for ten miles down either road. The only white children with two pairs of shoes and shampoo. Amanda and Guy and the love that passed between them like a field of light. Everyone on Esperanza watched it but only the black people knew what they were watching. Only the black people knew what it meant."

When she is 14 years old Amanda becomes pregnant by Guy, who is about to go off to star in football at the University of Mississippi. Her rigidly Catholic family insists that she go to term and that the baby, a girl, be put up for adoption: "What she has forgotten. What she refuses to remember. What she must carry with her always. Her cargo." She makes a vow: "I will never marry anyone and I will never have a baby and no one will ever make me do that again. No one will ever make me do anything I don't want to do as long as I live." She does marry, though, a wealthy resident of New Orleans, Malcolm Ashe, whose persistent devotion only leaves her dissatisfied. She is, now, 44 years old and determined "to find out what I really want in the world." She goes back to school, where she discovers that she has a gift for languages; this leads to an opportunity to translate the poems of an 18th-century French poet, Helene Renoir, an opportunity that in turn leads to her decision to ask for a divorce and to move to the Arkansas university town of Fayetteville.

It's here that, quite abruptly, The Annunciation loses its toughness and irony. Amid the potters and the professors and the philosopher-poets of the Ozarks, Amanda McCamey turns into mush. She falls madly in love with 25-year-old Will Lyons, though it is difficult to see why, and overnight she turns into a merchandizer of the most indigestible psychobabble. There's no smile on her face when she looks at Will and describes the purpose of life: "Loving yourself, not letting your self-esteem be in the hands of other people. Being in touch with the phenomena of yourself, being aware of your place in the phenomenonological universe. Your place in a universe of air and water and light, this holy place and time in which you are conscious, perhaps the only conscious thing in all the universe."

There's enough such twaddle in The Annunciation to fill several volumes of orations by Leo Buscaglia, PhD. In fact, that just might be good old Leo masquerading as Garth Hotchkiss, an old buddy from Amanda's college days who now lives in the hamlet of Eureka Springs, where he does Tai Chi and drinks peppermint tea and serves "kale and carrots and thick brown bread, everything arranged on white plates like a painting," and is deep into something called the Anahat Chakra: "It's all I'm working on now. It's here by the heart and it's the center of compassion and intelligence and universal love. It's the place that sends the best of us out into the world. It's goodwill and humor and real tenderness and real joy."

What on earth has gotten into Ellen Gilchrist? She puts these words into her characters' mouths as if they had been hand-delivered from heaven, as if they contained life's deepest truths; she seems not to have the slightest understanding that Amanda and Garth and all these other middle-class rustics are actually speaking nothing except sentimental nonsense of the sort that passed for profundity on the college campuses in the '60s and '70s. Slogging through page after page of this hot-tub philosophizing is an excruciating chore; it is difficult in the extreme to believe that the author of In the Land of Dreamy Dreams wrote this, but she certainly did.

For 130 pages, The Annunciation is a complex, interesting, occasionally startling novel; but as soon as Gilchrist moves Amanda away from the conflicts and discontents of New Orleans, the book falls to pieces. It immediately becomes repetitious, windy, overlong and banal, and there's nothing in the last 220 pages that redeems it. Perhaps, like a number of other gifted writers, Gilchrist is simply more suited to the short story than the novel; perhaps she let her good intentions get the better of her. Whatever the case, The Annunciation is a genuine disappointment: a bad book by a good writer.