The Newport Jazz Festival-New York yesterday headed toward a climax of an eight-day run, its last stand in New York and nearby New Jersey after six years.

The festival is moving upstate to Saratoga Springs next year.

Yesterday's festivities were marked by an eight-hour celebration of the blues at Waterloo Village in nearby Stanhope, N.J.

About 3,000 persons, mostly beerdrinking youths, crammed a circus-type tent, and another 1,000 sat on blankets on the lawn. They were there to hear the music of the cotton fields and levees of the Deep South.

Starting off the fete was the Muddy Waters Band stomping its way through seven pieces to the throbbing rhythmic clapping of the audience. Waters finished his one-hour set five minutes early, giving him time to play several encores.

Next came Wallace Davenport and his All-Star New Orleans Band. But he offered only two blues, "Tin Roof Blues" and "Basin Street Blues."

At the same time in a gazebo about 500 feet away, a progression of small acts performed for a smaller crowd. Louisians Red led off the procession, followed by Sweet Papa Stovepipe, Lloyd Glenn and Gatemouth Brown.

The only disruption in the afternoon came during a performance by Sammy Price's hand. Two drunks jumped on the stage. One of them danced and the other played the harmonica - in the wrong key for the piece the group was playing.

The festival was in high gear over the weekend. Pianist Earl Hines and trumpeter Roy Elridge, both pioneer figures whose careers date back to the '20s, where saluted Saturday night.At the same time pianist Dave Brubeck and his sons held a family gathering in a concert at Waterloo Village.

Eldridge, 66, didn't attend the concert Saturday night, but his solos, transcribed from records, were performed by three trumpeters in the New York Jazz Repertory Company.

Anita O'Day, who sang with Gene Krups's band in the early '40s, the same time Eldridge was in the orchestra, delivered a couple of vintage songs.

The heart of the concert, however, was the performance of the 71-year-old Hiners, whose playing seems to mellow with age. He and the 16-piece hand offered a rousing version of "Deep Forest," his orchestra's theme for 20 years. Singer Joe Williams dashed on stage at one point to sing one of Hines' '40 hits. "Stormy Monday Blues."

The Brubeck aggregation played a varied program but got the biggest response from more than 3,000 persons with a medley of Duke Ellington songs.

Another feature of the festival was the appearance of six symphony musicians from Argentina who played oldstyle New Orleans jazz with a Latin flavor.

"It's formidable to hear a foreign band remind us of our own culture," said festival producer George Wein.

Led by cornetist Marcos Cobo, the group plays in a tight ensemble style reminiscent of the early Louis Armstrong band.

The festival ended last night with a dance at the Roseland Ballroom, featuring the orchestras of Count Basie and Sy Oliver.