ONCE considered merely the outlets for meticulous scholars -- the publishers of recherche titles like Village Bureaucracy in Southern Sung China and Semoitics and Thematics in Herme- neutics -- American university presses have recently become a mainstream cultural force. A Confederacy of Dunces, published by Louisiana State University Press, won the Pulitzer Prize for fiction in 1981. Of the 25 books nominated for National Book Critics Circle awards in 1984, four come from university presses: Joseph Frank's Dostoevsky: The Years of Ordeal, 1850-1859 (Princeton) and Eudora Welty's One Writer's Beginnings (Harvard), both in biography; David Bromwich's Hazlitt: The Mind of a Critic (Oxford) in criticism; and Dick Allen's Overnight in the Guest House of the Mystic (Louisiana Stte University) in poetry.

J.G. Goellner, director of the Johns Hopkins University Press, estimates that each year the approximately 100 university presses publish 10 percent of

American book titles, account for 1.5 percent of sales, but win about 20 percent of book awards. Princeton's director Herbert Bailey is even more bullish. "If you were to compile a list of the books that make a real intellectual contribution each year," he says, "I think you would find that more than half of them are put out by university presses."

Besides their commitment to high quality, nearly all university presses share the condition of being subsidized by the parent institution. In the words of a 1979 report by the American Council of Learned Societies: "University presses were established because of the need to publish meritorious scholarly works that would not attract a large enough readership to warrant publication by commercial publishers." Thomas McFarland, director of the University Press of New England, offers a more colorful formulation: "Losing money is what university publishing is all about. That's why we exist." Yet financial pressures have been squeezing university budgets, and line items for subsidies must look like red flags to educational budget-cutters.

At the same time, university presses have had to cope with changing demographics. The total number of undergraduate degrees awarded in 1982 topped the 1972 figure by 7 percent. Within those totals, however, there was a marked shift in fields of study. The number of students majoring in the humanities and the basic sciences fell by 18 percent, while the number majoring in the applied sciences -- business, engineering, health care, education, computer science -- rose by 32 percent. Yet traditionally university presses have considered it their mission to publish the results of research scholarship, including such original source material as letters and diaries, and have looked primarily to liberal-arts undergraduate and graduate students and their professors for readership.

The general economic climate for university-press publishing has also worsened in the last few years. "Various levels of government have been cutting taxes," explains Harlan Kessel, sales director for University of California Press. "That has led to drastic declines in library budgets. Meanwhile, the costs of publishing have skyrocketed. Bookstores have been changing, too. They've been moving to the suburbs, and the chains -- B. Dalton and Waldenbooks and Crown -- have enjoyed enormous growth. Yet they don't carry or special-order many of our books. Besides college bookstores, we rely more and more on specialty or personal-service bookstores to sell our books."

The upshot of these changes is that whereas U.C. Press used to count on selling between 2,500 and 3,000 copies of almost any book it published, today that expectation has dropped to between 1,000 and 1,200. To cope with their declining unit sales and the pressure to keep the annual subsidy as low as possible, most university presses have adopted standard cheese-paring tactics: streamlining operations, printing fewer copies of each book, raising prices. Many of them have also been seeking out books with higher sales potential.

At the University of California, this strategy has meant tapping the trade-book market. Though it issues more SAMs (standard academic monographs) than ever, U.C. Press has also been publishing books like Abortion and the Politics of Motherhood and The Black Box (on the Korean airliner shot down by the Russians). Other presses have been taking the same tack. The University of Nebraska Press has published books on mountain climbing by Jeremy Bernstein, a New Yorker staff writer, and In God's Countries, a volume of nature essays by Bil Gilbert, who writes regularly for Sports Illustrated. Johns Hopkins has published Wits and Sages, reporter Neil Grauer's profiles of syndicated columnists like Art Buchwald and Ellen Goodman. The quality of these books may be unimpeachable, but to call them all scholarly would be stretching a point. Chasing Best Sellers

Though his was the first university press going so far as to publish new fiction, LSU director L.E. Phillabaum is skeptical about chasing after best-sellers. "It's too risky," he says. "Nobody can predict them. What we can do is try to secure titles with a bit broader interest -- the books that are falling out of the trade sector. That's what happened with A Confederacy of Dunces. Nine trade houses had turned it down by the time we saw it. We published it because we thought it had high literary merit. We could afford only a meager ad budget, so we got a best seller in spite of ourselves. That's the way it should always work." The riskiness of publishing new fiction may explain why only two or three other university presses have followed LSU's example.

Another survival strategy is specialty publishing. Regionalism is especially popular. For instance, the University of North Carolina Press concentrates on books about its state (The Carolina Backcountry on the Eve of the Revolution, for instance) and about one fourth of University Press of New England books are regional studies. Claiming the entire West as its province, University of Oklahoma Press has published more than 250 books on the American Indian (including such titles as The Menominee Drums and The Peace Chiefs of the Cheyennes among them). In Vino Veritas

ANOTHER KIND kind of specialty is one chosen by The University of Minnesota which has built a reputation on fine translations from European literature. Johns Hopkins is one of the few university presses to take advantage of the shift in studies by successfully publishing applied-science books, especially in the biomedical field. Howard specializes in books of Afro- American interest, though it also reprints fiction and publishes general scholarly books for the National Archives.

For some of its most dramatic forays into the mainstream market, U.C. Press has drummed up partners and backers. Its new $65-a-copy book on California wine is a co-production with Sotheby Parke Bernet. For help in marketing its low-price paperback series of uncorrupted Mark Twain editions, the press obtained a grant from the National Endowment for the Humanities.

Though he may talk like a prodigal, Thomas McFarland is in fact a pillar of Yankee parsimony, and the press he directs -- The University Press of New England -- has transformed the joint venture into a way of life. It all began in the late 1960s, when Dartmouth College decided it didn't want to be the only Ivy League school without a press. With a view toward holding down costs, Dartmouth officials sounded out other pressless institutions on the possibility of launching a co-op. In 1970 the University of New Hampshire said yes, and within 18 months three other universities joined up. Today the press is nine strong (the other schools are Brown, Brandeis, Clark, University of Connecticut, University of Rhode Island, University of Vermont, and Tufts), has annual sales of $500,000 and maintains a backlist of 300 titles.

Like other university presses, New England is subsidized, but the burden is light. The average subsidy provided by universities with presses of comparable size amounts to $250,000 a year. On the strength of its shared overhead and operation, New England gets by with only half that amount -- and this is divided nine ways. New England has also formed an international sales consortium with the presses of Cornell, Johns Hopkins, and California. Based in London, the venture markets members' books in Great Britain, the Continent, the Middle East and Africa.

University presses are also looking for high-tech help. One avenue among many involves the increasingly ubiquitous word-processor. "As more and more scholars work on processors," says Herbert Morton, director of the Office of Scholarly Communications and Technology for the American Council of Learned Societies, "opportunities open up. Work is underway to develop a compatible language for all processors. When that becomes available, editors and writers will be able to communicate back and forth quickly and efficiently. Ultimately, the author's final version could go directly to the printer, and the savings could be substantial." Future Schlock

University presses hope that these strategies, in various combinations, will tide them over for a while. And a renaissance of humanistic studies may be in the offing. William J. Bennett, chairman of The National Endowment for the Humanities, who recently issued a report lamenting the degradation of the liberal-arts curriculum, is considered "very hospitable to books" by Princeton's Herbert Bailey. Bennett is also reportedly a leading contender for Secretary of Education in the second Reagan Administration.

In the meantime, Bailey believes that most university presses will survive -- "the parent institutions have made strong commitments to them" -- but fears that "scholarly communication in some fields may suffer." He also worries that some presses may move so eagerly into the trade-book market that "the reasons for support from the parent institutions will be vitiated." This is the catch-22 of university publishing: too much mainstream success may undermine their very reason for being.