NOVELS ARE the dinosaurs of sf and fantasy publishing. They dominate the ecosystem, swallowing up most of the money and almost all of the critical attention. But while the world's eyes are fixed on these great lumbering behemoths, small, furry creatures are darting between their legs and stealing the future. Down at ground level, where nobody looks, serious art is being created. Today we examine three new collections of short stories, to see what lies behind their egg-stained smiles.

Dreams of Dark and Light (Arkham House, $21.95) is subtitled The Great Short Fiction of Tanith Lee. This is serious bragging, and it's a pleasure to report that the contents of the book back it up.

Tanith Lee writes fantasy for adults. It is darkly, lushly romantic stuff, with silvery veins of eroticism and sinister beauty. In "Nunc Dimittis," for example, the aged and dying servant of a vampire princess recruits his replacement from the criminal underworld. The story is shot through with sexual tension, even perversity, and a fey sympathy for the wild creatures that exist beyond the bounds of human law. Yet, at the same time, it is a simple and touching tale of love and loyalty.

Strange sexual undercurrents run through all of Lee's work, often coupled with dark yearnings toward death. Her favored characters alternate between the poles of obsession and seduction, and the sole true sin (as in "Black as Ink," her elegant modernization of the swan maiden fairy tale) is not to give in to the romantic impulse. The heroine of "Bite-Me-Not or, Fleur de Fur," chooses her demon lover over comfort, luxury and fulfillment of her childhood dreams, and, despite the heavy price she pays, is right to do so. Her tragedy ends in a moody and evocative tangle of sex, salvation, death and love. The shopgirl's obsession with a beautiful paralytic in "Magritte's Secret Agent" is not at all healthy, nor is it meant to be. Other stories flirt with bestiality, patricide, and even necrophilia, though always in disguised, submerged form.

But the strength of Tanith Lee's work lies in the marvelous joinery of her sentences. Her prose practically shimmers on the page. What would in the hands of a lesser writer -- a merely good writer -- collapse into purple fustian, Lee makes work. "Elle est Trois, (La Mort)" is a tour de force of writerly skill. The only fantastic element is death itself, represented by three avatars that could justly be taken as simple metaphors. Yet she handles them like a dark conjurer, trading off voices and personas with the skill and sophistication of Lady Death herself toying with carnival masks.

These are stories best read in the evening, amid expensive surroundings, a snifter of fine brandy by the elbow. I read several in the bathtub, a bottle of beer in my hand, with undiminished pleasure, but I felt guilty about it afterward. The Alienated and Alien C. J. CHERRYH's tales are built of plainer stuff. She writes in a simple declarative style that is infinitely harder to achieve than it looks, spins a straightforward narrative line, and likes to refer to herself as simply a storyteller. Visible Light (DAW, $3.50), her first collection, includes the full spectrum of her work -- short and long, early and recent, science fiction and fantasy. This is as fair a summation of her talents as it is possible to have.

As a writer of "adventure" novels and an extremely popular one at that, Cherryh has been largely dismissed by the critics as a writer of simple pop entertainments. Thus, it is a little startling to see what her work is actually about.

In "Cassandra," a woman thought mad by the world wanders through visions of the coming nuclear holocaust. The time traveler in "Threads of Time" loses home, wife and children and then all memory that they ever existed. In "The Brothers," a bastard foundling returns home to kill his father. The wizard in "The Last Tower" brings on the heat death of Faerie. These are extreme stories of alienation, with the most chilled-out protagonists this side of Barry Malzberg. They are all castaways and outlaws, bereft of the comforts of community. Indeed, insofar as human interaction exists in Cherryh's stories, it exists for the sole purpose of demonstrating that her heroes are not very good at it.

"Companions," the longest work here, is representative. In it, a lone man struggles to survive on a world with no animal life, interacting only with a soulless robot extension of his crippled ship. He discovers what may be a form of alien life undetectable to his machines, and tries to make contact. But contact is risk, and the closer he comes to understanding, the closer he comes to death. He is left hopelessly yearning, like a moth for the flame. Meanwhile his ship (which in a strange and effective subtext behaves exactly like the hostile wife of a bad marriage) seeks to destroy the life form it simultaneously denies exists.

Yet Cherryh's characters, trapped though they are in a hostile universe, still strive to achieve whatever small good is available them. The thief of "A Thief in Korianth" is motivated not so much to save herself from prostitution as to save her younger sister from following in her footsteps. In "The Brothers," the forlorn hero negotiates with uncanny powers, trading his happiness, his life and finally his scruples for the chance to do somebody -- anybody -- some good. Ultimately, at the cost of his soul, he rescues the brother he has never met, a child whose only claim on the hero is that he exists.

Visible Light is probably meant as a treat for Cherryh's fans, but may be best taken the other way around, as a sampler of the bittersweet pleasures to be found in her longer works. Weird and Wonderful FINALLY, Howard Waldrop's collection comes slouching on stage, dressed-for-failure in a turquoise book jacket and bearing the atrocious title Howard Who? (Doubleday, $12.95). It's a slim book, containing 12 stories, each with a genial introduction in which Waldrop explains why he's consistently sold the bulk of his work to the lowest bidder, often appearing in fanzines with a total readership of perhaps 2,000. They laugh when he sits down at the piano. Ah, but then the music begins . . .

Howard Waldrop is the resident Weird Mind of his generation, and he writes like a honkytonk angel. Howard Who? contains three of the best sf stories ever written, one of the worst, and eight that range from the miraculous to the merely entertaining.

"I haven't seen any of those ugly chickens in a long time," an old woman remarks to an ornithologist sitting beside her on a bus. The ornithologist is holding a book open to a drawing of the dodo bird, the story is "The Ugly Chickens," and the game is afoot! In "Ike at the Mike" a young Dwight David Eisenhower is rushing to catch the train to West Point when he hears some black musicians playing jazz, and his life is changed forever. The eponymous hero of "Man-Mountain Gentian" is a telekinetic sumo wrestler. These are wonderfully unpredictable stories, and to give away more of their plots than I have would be criminal.

This startling originality is coupled with great technical skill. ". . . The World, as We Know't" is a classic work of hard science fiction, meticulously researched (in typical Waldrop fashion, he spent six months preparing to write this one story), and is a model of how to incorporate scientific content into a fast-moving narrative. Or it would be, save that the science in it is the long-discredited phlogiston theory of chemistry. (Guest appearances by Natty Bumppo and the Lunatick Society are merely the kind of joyful flourish one comes to expect from Waldrop.)

Howard Waldrop has a reputation as a humorist, and indeed "Save a Place in the Lifeboat for Me," is hilarious. But "Doctor Hudson's Secret Gorilla," which follows the plot of a grade-B horror movie through the eyes of the experimental subject, is sad and touching in the extreme. In fact, most of Waldrop's work is comic-sad. It is about loss, and yet the loss is transformed by the humanity of his vision. In "Mary Margaret Road Grader" the post-holocaust Sioux test their prowess by stealing strings of automobiles and by holding yearly tractor-pulls. At the end, the elders are shaking their heads at the way automobiles have disappeared, and the young have turned to horses instead. The old ways are fading.

Howard Who? is not perfect. One of his Waldrop's best stories ("Flying Saucer Rock and Roll") has been left out, possibly for commercial reasons. And "Horror, We Got," a comic attack on right-wing paranoia, is the kind of truly awful story that takes real genius to produce. But with this one exception, these are all magical stories, beautifully written, and enormously fun to read. Some of them will stay with you forever.

I've saved the best for last. "God's Hooks!" has Izaak Walton and John Bunyan fishing in the Slough of Despond. More than that I dare not say, save that it is full of delights and surprises and even wisdom. This is as good a story as has ever been written. In his introduction, Waldrop says he can't understand why somebody didn't beat him to this -- that the plot was self-evident, and that anybody could have written it. Not so. Like most of the stories here, "God's Hooks!" could have been written only by one man -- Howard Waldrop, writer extraordinaire, and the funniest thing the dinosaurs have seen since the first mammal.

Michael Swanwick is the author of "In the Drift" and the forthcoming "Vacuum Flowers."