Over in a corner, two small boys were fencing, their faces carefully protected with mesh fencing masks and a blue balloon attached to each of their jerseys, right over the heart, so that it would be most palpable when somebody scored a hit.

Around the corner, a Washington group called Musica Antiquaw was performing "Pastyme and Good Companye," a song composed by King Henry VIII, and down the road a bit of commedia dell'arte troupe was semi-improvising a slightly bawdy Renaissance comedy. A jester did cartwheels, and a troupe of three jugglers was busily tossing silver-colored clubs back and forth, one juggler standing on another's shoulders.

Wandering through the motley crowd was a magician, dressed in the black costume of a Tudor alchemist, pulling coins out of people's ears, hair or pockets and dropping them with a loud clink into a metal container.

"You have to grow with the crowds," said Julius C. Smith, smiling down on the crowd which seemed to be growing to his satisfaction as the first weekend of the second annual Renaissance Festival swung into high gear in Columbia, Md.

Smith, a Minneapolis attorney who is 6 feet 8 1/2 inches tall and built like a professional linebacker, was a striking figure, garbed in the bright red robes of a Catholic cardinal and presiding benignly ("Bless you, my children") over the festival's bewildering variety of activities.

For the thousands of visitors who wander through it, the Renaissance Fair is a chance to get some exotic entertainment, with the added attraction that is "educational"; for the musicians and actors who attract the visitors and for the craftsmen who build their own booths and hawk their wares with Renaissance-style street cries, it is a chance to attract customers.

For Julius Smith and his partner Jack Sias (also a Minneapolis attorney), it is a combination hobby, vacation and long-term investment. "Both of us have practices which we can schedule to take a few weeks off, and this is how we spend them," Smith said in an interview.

The first Renaissance Festival in Columbia last year was a financial disaster, with rain on six of the fair's eight days, which are spread out over four weekends. This year, the partners expect about 30,000 paying customers (adults, $3.75; children under 12, $1; children under 5, free). They are paid rent for the 50-plus crafts booths, but they don't expect to start making a profit for another year or so.

"You go into something like this expecting to lose money for the first two or three years," said Sias, decked out in the rich, velvet costume of a Renaissance courtier. "Later, we will make a profit, but now we're just enjoying it. I don't want to downgrade the practice of law, but frankly this is more fun."

The running of a Renaissance fair is a well-established art by now, with precedents going far back into the 1960s when a California couple, Ronald and Phyllis Patterson (teachers of high school English and history) began one as a school project. They now have two of them, one in Los Angeles and the other in Marin County, which attract more than a million customers per season (six weekends each), as well as a Dickens festival in San Francisco at Christmas time.

The idea was brought to Minneapolis by George Coullam ("King George"), an environmental engineer the Pattersons in California. Now, the people who have worked with Coullam are exporting the idea successfully to other states. There is a Renaissance fair in Houston, one in Kingston, N.Y., and another in Kenosha, Wis., where it attracts visitors from both Chicago and Milwaukee. Smith and Sias believe that the location of Columbia, between Washington and Baltimore, will have similar drawing power in both cities.

"Most of these festivals take three or four years to get up to speed," said Smith, who thinks that 200,000 customers (approximately the number attracted by the Minnesota and Houston festivals each year) would be a good figure to shoot at.

Despite a casual appearance, with booths rough-crafted from bits of burlap, canvas and bales of hay, thatched roofs and straw spread on the grounds to keep down the dust, the fair is designed in a pattern carefully worked out through experience elsewhere. Smith has done his market research thoroughly, knows that the average visitors stays four hours and readily points out that the fair grounds have a roughly circular pattern because "crowds like to travel in circles; it's harder to get them to turn around and go back to see something they have passed."

Some of the biggest attractions are placed at the far end of long lanes which take the customers past vendors' booths, and the timing of dramatic musical and acrobatic events seems desgined partly to keep the crowd moving along in the desired patterns.

When things seem to be happening spontaneously, they aren't," said Frank, the festival's "master of the revels," who coordinates the individuals and group ("48 of them the last time I counted, but I'm underestimating") that provide the festival non-stop, three-ring entertainment.

Besides the more or less formal acts on stages strategically located around the fair grounds, a lot of the action at the festival is street theater. Someone may walk up to you, for example, hand you a piece of rope asking "would you hold this for me, please?" and then go off, leaving you to discover that the other end of the rope is attached to Cog, the Village Idiot, who is very realistically portrayed by Gary Young of Archaesus Productions.

And until you can pass off the rope on someone else, you are stuck in a dramatic encounter with Young, who finds that the idiot role "comes pretty naturally to me," though he spends most of his time in the office directing the activities of a group that plays in schools and colleges, at Wolf Trap and the Kennedy Center as well as touring on three continents.

Perhaps the most vivid bit of street theater is provided by Patti Thompson, an independent actress from Baltimore who tours the fair grounds in Elizabethan garb (patched apron, long skirt, low-cut blouse and brown jacket) bearing a sign that reads, "Rent a Wench, 50 cents." For this sum, she offers "a passionate kiss that will take you to heaven and bring you back - or leave you there, as you please."

One man whom she approached with this offer appologized; "I have my own wench here," but another, in the interests of getting all the news, tried the trip to paradise. The kiss was fully professional in quality but somewhat too short in duration to reach the promised land. Thompson's lipstick smeared, but master of revels Roberts explained that, this was authentic: "Lipstick of the period was made of cochineal - the carapace of a small beetle - mixed with lard or a similar material. It must have smeared easily."

Thompson estimated that she had taken around 70 patrons to paradise Saturday. Another businesswoman at the fair was betty Farell of Towson, proprietor of "Rosie's Posies," who sells flower garlands for women's hair patterned on those in Renaissance paintings. She interrupted a conversation with Engle Conrow, who goes around the fair reciting Shakespeare and other Renaissance poets, to say that she sells a total of 100,000 garlands at four Renaissance fairs and one Dickens festival each year.

Why people go to these events in such numbers is not fully explained. Julius Smith believes that the atmosphere is important: "You step into Symphony Woods and it's another world; there no electricity here, for example." Roberts finds an element of "controlled fantasy" in the fair's appeal: "The Camelot bit appeals to a lot of people; it's fuzzy at first, but some people rally get involved, begin to feel the texture of history; the costumes become more accurate, and you find serious people - physicists and computer experts and doctors - becoming deeply involved."

Many of the deeply involved patrons came in home made costumes similar to those of the musicians and actors. Scott and Gwen Carpenter, for example, a young married couple strolling through the fair in Renaissance garb, said they had "decided to come in style."

"We're Arthurian fans, fantasy fans," said Scott. "We heard about this and wanted to see it, but we had no idea it would be so large or the details so authentic."