The ultimate American ethnic story is the one in which the nice but exotic-looking young hero, who would like to go sufing, be an astronaut and date girls named Debbie and Sherry, can't get into the mainstream because his sweet old grandfather has ordered him to take over a kingdom.

This is roughly the plight of the hero of "King of the Gypsies," a film based on the biography of a yound New Yorker who unwillingly inherited the position of "king of kings" to numerous East Coast American gypsies, who are pictured as widespread and uncontrollable groups of ragtag but graceful thieves.

It's an excessively romantic picture, with heartbreakingly handsome people photographed in throbbing sun or firelight, their sensually moving bodies as inevitable as the violin background. One can laugh at this , of course, dragging it into harsh daylight by noticing such things as how fat and comic Shelley Winters looks as a dowager gypsy queen, or one can enjoy its beauty on its own terms.

The story is less important than the soul-and-wits mood of the film. It's a contrast between ordered America - the decently ordinary-looking people with their checked emotions and commitment to civilized rule-following - and the mixture of passion, chaos and ritual represented by the gypsy culture. When the teen-aged king-designate temporarily breaks away and finds a redheaded California girlfriend, the fact that it can't last is symbolized by her inability to look at him when his face is bleeding (from as assassination attempt ordered by his father.) A gypsy girl finds blood natural, as we see when one wipes off his gory face as a prelude to lovemaking.

Illiterate, cruel and scrupulously dishonest, the gypsies nevertheless come across as having blood in their veins, while their victims seem anemic. This makes the gypsies the humans in the drama, and one can't help but be on their side when they manage to thwart elaborate legal and civic systems by the delightfully simple method of refusing to play the game fairly.

Every pull of family tradition, food, music and "the old ways" that has tortured a sensitive but assimilation-ambitious hero in an Italian or Jewish story is intensified here - not quite to the point of parody.

A great part of the power comes through the compelling physical presences of Eric Roberts as the gypsy heir, Sterling Hayden as his grandfather the king, and Susan Sarandon and Brooke Shields, who played mother and daughter prostitutes in the beautiful film "Pretty Baby," as the hero's mother and sister - all together, a great many pairs of burning eyes.

They make surfing or astronaut-ing seem dreadfully tame. KING OF THE GYPSIES - AMC Carrollton, K-B Baronet West, K-B Georgetown Square, Roth's Tysons Corner, AMC Skyline and Springfield Mall.