There was an old lady who lived in the Tennessee foothills. She had less money than most people and certainly less than her next hill neighbor.

Every year she gave the neighbor the best Christmas present of all: an apron made from a cloth feed sack. The sack, in case you're too young to remember, was pleasantly printed for that purpose, and the old lady's handwork was exquisite. Every year the neighbor looked forward to receiving the beautiful apron.

But one year the old lady sold off an acre of land and, flushed with prosperity, gave a store-bought doodad for a present. The neighbor hated it - and of course had to display it prominently for at least a year until it could be fortuitously broken by the dog.

Unfortunately, the old lady is dead and gone now, and it's likely that feed sacks no longer can be recycled. However, there are places in Washington where you can buy gifts that carry the marks of the makers on them, even if you haven't the time or the talent to make them yourself. Crafts make a nice change from the R2D2 type gift.

The Community Service Administration has a boutique every year that may well be the greatest of the undiscovered places to buy stocking stuffers: bright red and white clowns for $3.75; tea cozies, $11.98; substantial hearth brooms, $4.80; scarecrow, $9.20; mittens in many sizes, $2; Jacobean velvet vest, $27.95; nutshell wreaths, $18; rugs made in New Mexico, $120 for the 4-by-6 size. All are made by craft cooperatives across the country, many by handicapped citizens. All the wares seem underpriced for the high quality and splendid workmanship. The shop is at 1200 19th St. NW, second floor. Open Monday through Friday through Dec. 23 at business hours.

The Museum of African Art at 318 A St. NE has a collection of Moroccan rugs and textiles in its 1977 Christmas Exhibition and Sale. The Berbers of Morocco raise the sheep, card the wool and weave the rugs in their homes, passing on the techniques from generation to generation. All thr rugs at the museum are 100 per cent wool and handwoven, which makes the prices - $200 to $600 - all that more surprising. Even cheaper are the saddlebags and cushions made from rug remnants, beginning at less than $60. There are also dress lengths of fabrics from $6 to $10 and ties already made. According to Jil Elisofon, the boutique manager, that nest of 10 baskets from Upper Volta ($50) is intended for a bride, but for others, you might consider the basket serving table at $170.

The National Trust for Historic Preservation at 740 Jackson Pl. NW has needlepoint kits for pillow covers and eyeglass cases with designs selected from the Trust collections. A Frank Lloyd Wright design for a needlepoint pillow kit comes from the window in the reception hall of his home and studio in Oak park, III. Washington artist Lou Stovall designed the National Trust's 100 per cent silk scarf ($12.75). The hostess apron ($76), also wearable as a skirt, is in a "shoo-fly" design and made by Maine craftsworkers.

The Smithsonian is into Christmas big this year. At the Renwick Gallery, for instance, there are a great number of baskets (an allusion to the Grass show) for sale. All the other Smithsonian branches have objects for sale befitting their interests, from the zoo to the Hirshhorn. Best of all are the dinosaur kits designed by Michelle Lipson, with silk-screened cotton muslin and full stitching instructions, $8 each for Triceratops (25 inches long), Pterandon (50 inches) and Tyrannosaurus Rex (24 inches). The Smithsonian also has soft sculpture kits for a Punch doll ($8) and a Sopwith Snipe airplane ($8). Smithsonian Associates receive a discount. The kits are available by mail, though who could say if they would make it by Christmas, by writing the Smithsonian Institution, P.O. Box 1641, Washington, D.C. 20013.

Some places are almost a crafts shopping maill in themselves. The Torpedo Factory, along the river in Old Town Alexandria, is, of course, the bigh one with pottery, painting, woodworking silkscreening, textile arts and on and on.

The Senior Craftsmen Shop at 2647 Conecticut Ave. NW is a grand place to buy the sort of children's caps and mittens, soft toys and addresses you wish you mother knew how to make. They also have handmade gifts for adults.

The Textile Museum at 2320 S St. NW has an assortment of large bedspreads (phul-karis) from Pakistan ($80). Some ar perfectly beautiful. But the basic aim of the shop is to provide materials for your own art: canvas with designs, unusual yarns and even the needleperson's tools.

The Pan American Union on 17th Street at Constitution Avenue NW is like a Mayan pyramid stuffed with glitter: jewelry from Mexico; intricately woven fabric (by the yard, the tablecloth, the placemat, the skirt, the tie) from Guatemala; and Christmas tree ornaments from several Latin countries.

The Indian Affaisr Office of the Interior Department at C Street between 18th and 19th Streets NW has Indian jewelry, rugs, dolls and wonderful baskets, all certifiedly from the original Americans.

You might consider the work of craftspeople of Christmas past. The Christ Child Opportunity Shop on Wisconsin Avenue at P Street NW in Georgetown had a few days ago, for instance, a silver tray with a center of cut crystal in the art moderne manner - $90 and a bargain. This is also the place to look for large silver serving pieces. If you have the money you could make the recipient scream for ice cream with the set of 12 sterling silver sherbet compotes, $480. There are heavily embroidered shawls for pianos, tables and backs. Much old copper is stuck around, including a copper brazier with its own wooden table and a tea kettle suspended on a warming stand. All, of course, previously owned and treasured.

The Bombe Chest at 2629 Connecticut Ave. NW is a great repository of similar objects, with perhaps a shad more art deco. The other day they were offering eight sterling silver spoons, probably fruit spoons, since the bowl ended in a decided point, all for $65 - compare that with the going price of $23 per new sterling teaspoon. In the window were two handsome brass pieces, signed Tiffany Studios. Both the Opportunity Shop and the Bombe Chest benefit Catholic and Jewish charities respectively.

Not - strictly speaking - handmade, but certainly out of the class of the plastic Christmas present, are reproductions from Washington institutions:

The National Archives is selling the Declaration of Independence, the Constitution and several other important documents, including former President Richard Nixon's resignation, in its book, "The Written Word Endures: Milestone Documents of American History," $11.25. World War I posters - the American Eagle, Sailor Girl and sailor Boy - are $1.50 each. A portfolio of Matthew Brady photographs, suitable for framing, is $5. Included are Clara Barton, lincoln, Grant, Walt Whitman and gen. Sherman. Another portfolio is of six drawings of ships of the early 1800s, "Ages of Sail and Steam Prints," $15. The Archives even speaks to you, with "The Sands of History," a tape that includes Calvin Coolidge speaking, Marian Anderson singing. Will Rogers joking and Hitler ranting, $2.50. The Archives products are also available by mail (National Archives Trust Fund, Cashier (NEPS), National Archives, Washington, D.C. 20408). But then you have to add a dollar to the prices of most things, $2 for the Brady portfolio and $1.25 for the book.

The Library of Congress sells a scarf reproduced from a "Reward of Merit" cloth copyrighted by Ephraim in 1826. Rewards were given by school teachers to the deserving in the late 18th century. Thisone is an alphabet enclosed in a geometric border.

The National Gallery, as you might expect, has a $19.95 Winslow Homer Watercolor Portfolio, suitable for framing, among its offerings. One of the better presents would be one of the full natural color catalogs from the National Gallery's own shows, or an erudite tome from one of their experts.

Or perhaps you could make someone an apron. If you could only find a feedsack.