By Charles Dickinson Morrow. 232 pp. $18.95

ONE Halloween morning, Danny Fain, associate metro editor of the fictional Chicago Bugle, riding a commuter train to a meeting where he will be informed that his newspaper is about to fold, witnesses for one short second a child, in ghost costume, being struck by a car. He alone sees a red, boxy vehicle speeding, with seemingly no intention of stopping, a small body flung skyward and that is all. An outbound train instantly obscures his vision.

What Fain does with this macabre observation is at the core of Charles Dickinson's sometimes satiric, slightly raunchy, often hilarious and altogether delightful novel, Rumor Has It. Instead of calling the police like some honest citizen, he orders a reporter from his staff to find the body. With this assignment, Fain steps onto the razor's edge of moral ambiguity that so often characterizes newspaper work.

The abandoned, lost and victimized child, of course, is a story most tabloid newspaper editors would, well, kill for. It has pathos, emotion and outrage attached to it. It will, in short, sell papers. With the right headline, proper display, good photographs, it is the sort of story that will force folks to fork over that quarter to the news hawker, or shove it into the slot of a vending machine.

So, over the course of a difficult, catastrophic day, with everything else around him tumbling down and heading to hell in the proverbial handbasket, Fain rides herd on this single story. Other disasters impose on him, ranging from the comic to the sensational. This relentless succession includes the explosion of a hijacked jet and an environmental protest that gridlocks Chicago traffic. At the same time, he has to deal with the turmoil caused by the unexpected announcement that his newspaper is about to cease operations. The staff, with all its eccentricities and uniqueness, turns to Fain, who struggles to balance all their hurts, surprises, angers and losses, while all the time he is really interested only in finding one lost body.

Author Charles Dickinson, a Chicagoan, has the nuances and manic energy of that city's newspaper world absolutely cold. He captures the competitiveness, spirit and occasionally pathetic quality of life at the big-city daily with deft skill. He has an exceptional way of making the minor characters come alive with an authenticity that anyone who has worked on a newspaper (especially a blood-and-guts tabloid) will appreciate. When the staff discovers a reporter planted in their midst by the rival (fat, financially successful) newspaper, who has been feeding their competition information about the stories they were preparing, they react with a shower of epithets, spittle and other unpleasant liquids aimed at the unfortunate. It is a scene of perverse power and humor -- and absolutely accurate.

True to form, as well, are the rigidly detached executive editor, the hulking sports editor, the indecently handsome, priapic young reporter Fain sends out to find the child's body and all the other major and minor denizens of the Chicago Bugle newsroom. It is the sort of group that, once informed that they will all be out of work within two weeks, organizes an office pool on who will get the first real job offer.

The winner, of course, is not Danny Fain.

His rewards, by the end of the novel, are more problematical. Suffice it to say that, in uncovering a single hit-and-run victim, no one discovers anything remotely pleasant about the life they have adopted.

There is, as one would expect, a sense of sermon mingled into the humor and high-speed prose of Rumor Has It. The author sees to it that no one who walks on the quicksand of journalistic ethics gets away without some mud on his feet. But Dickinson doesn't preach or pulpit-thump. His novel is nonstop, fast-paced, not even broken up into chapters, a single surge of energy -- reading it is not unlike participating in that unique adrenalin-pumping, single-minded passion that is pursuing the news. John Katzenbach, a former reporter for the Miami News and the Miami Herald, is the author of three novels and a nonfiction book. His fourth novel is forthcoming.