In what was supposed to be the year of the disco record, the Bee Gees won all the wrong Grammy Awards.

While "Saturday Night Fever" did win the Album of the Year award it earned by selling 30 million copies worldwide. Billy Joel's straightforward ballad. "Just the Way You Are," upset the Bee Gees' anthemic "Stayin' Alive" for both Song of the Year and Record of the Year.

However, the Bee Gees, who were expected to sweep the 21st annual awards ceremonies last night did pick up Grammies for Best Pop Vocal Performance by a Group, Best Arrangement for Voices for "Stayin' Alive" and Producers of the Year, along with their longtime collaborators Alby Galuten and Karl Richardson.

Other major awards went to Barry Manilow for his disco-flavored "Copacabana," pure disco-ers A Taste of Honey, the "Queen of Disco" Donna Summer, Playboy covergirl Dolly Parton and outlaws Willie Nelson and Waylon Jennings.

While host John Denver congratulated the Grammy Awards on achieving "majority" at 21, comedian Steve Martin (whose album, "A Wild and Crazy Guy," won for Best Comedy) proved that age does not mean maturity by arriving on stage in black tie and undershorts.

"It's about time," Martin snapped as his trousers, pressed and hanging under a plastic cleaning bag, were handed on to him by an attendant.

Other highlights of the awards show, telecast live from the Shrine Auditorium in Hollywood, included Denver's imitation of John Travolta: a five-minute tribute to the musical history of San Francisco by rock star Boz Scaggs; and a dozen production numbers -- which were outnumbered more than two-to-one by commercials (not counting the CBS in-house promotions).

An audible sigh of relief swept across the audience as Orson Welles beat out former president Richard Nixon in the Best Spoken Recording category. "Citzen Kane" outpolling the Nixon-David Frost interviews.

Winners in the nine classical categories, which were presented before the telecast, were announced in a single 90-second segment of the two-hour program. Jazz winners were disposed of almost as quickly.

In two instances, nominations were sung instead of recited: John Denver sang the Best New Artists list over Eubie Blake's piano, and Tanya Tucker and Glen Campbell sang together appropriately, the Country Vocal Performance by a Duo nominations.

The recording industry displayed its usual affection and concern for its past by inducting three recordings into the National Academy of Recording Arts and Sciences' Hall of Fame -- in two cases with significant bloopers. Presenter Dinah Shore announced an award to the Les Paul-Mary Ford recording of "How High the Moon," then listened with an expression of shock as the P.A. system blared out a recording of "How High Is the Sky?" She was so shocked that, in announcing the inclusion of Sergi Rachmaninoff's "Rhapsody on a Theme of Paganini," she identified the composer-pianist as "Sergei Romanoff."

A third Hall of Fame award to Count Basie's "One O'Clock Jump" was announced without mishap -- and without music.

The sartorial splendor of the evening was exemplified by Andy Gibb's decolletage and white shoes, Paul Williams' matching red ruffled shirt and sunglasses, and Denver's sequinembroidered tux with 21-inch bell-bottomed pants.

There were musical highlights, as well, including the off-key duet by Kenny Rogers and Dottie West. Faced with the challenge of performing the nominees for Song of the Year, Denver struck a bold compromise on the vastly divergent styles of the songs -- he sang them with no style at all.

Otherwise the prevailing musical idiom of the evening was disco, in the entertainment as in the awards. Even Neil Diamond and Dinah Shore were seen swaying in their seats to "Stayin' Alive."

As usual in such shows, the script glittered with sparking wit -- as when Andy Gibb waved a hand toward his Bee Gee siblings and shrugged, "They ain't 'heavy' -- they're my brothers!"

The awards for scoring which went to John Williams' "Close Encounters of the Third Kind" recalled the defeat by omission of "Saturday Night Fever" in the Academy Awards last year. In one sense, therefore, the Album of the Year award comes as a vindication of the "fever" which swept America in 1977.

The winners:

GENERAL CATEGORIES

Record of the Year -- Billy Joel, "Just the Way You Are."

Album of the Year -- "Saturday Night Fever."

Song of the Year -- Billy Joel, "Just the Way You Are." Best New Artist of the Year -- A Taste of Honey.

POP, ROCK AND FOLK

Best Female Vocal Performance -- Ann Murray, "You Needed Me."

Best Male Vocal Performance -- Barry Manilow, "Copacabana."

Best Vocal Performance by Duo or Group -- The Bee Gees, "Saturday Night Fever."

Best Instrumental Performance -- Chuck Mangione, "Children of Sanchez."

RHYTHM AND BLUES

Best Female Vocal Performance -- Donna Summer, "Last Dance."

Best Male Vocal Performance -- George Benson, "On Broadway."

Best Vocal Performance by Duo or Group -- Earth, Wind & Fire, "All 'N All."

Best Instrumental Performance -- Earth, Wind & Fire, "Runnin.'"

Best Rhythm and Blues Song -- Paul Jabara, "Last Dance."

COUNTRY

Best Female Vocal Performance -- Dolly Parton, "Here You Come Again."

Best Male Vocal Performance -- Willie Nelson, "Georgia on my Mind."

Best Vocal Performance by Duo or Group -- Waylon Jennings and Willie Nelson, "Mama, Don't Let Your Babies Grow Up to Be Cowboys."

Best Instrumental Performance -- Asleep at the Wheel, "One O'Clock Jump."

Best Country Song -- Don Schlitz, "The Gambler."

GOSPEL AND INSPIRATION

Best Gospel Performance, Contemporary -- Larry Hart, "What a Friend."

Best Gospel Performance, Traditional -- The Happy Goodman Family, "Refreshing."

Best Soul Gospel Performance, Contemporary -- Andrae Crouch, "Live in London."

Best Soul Gospel Performance, Traditional -- Mighty Clouds of Joy, "Live and Direct."

Best Inspirational Performance -- B.J. Thomas, "Happy Man."

ETHNIC/TRADITIONAL/LATIN

Best Ethnic or Traditional Recording -- Muddy Waters, "I'm Ready."

Best Latin Recording -- Tito Puente, "Homenaie a Beny More."

JAZZ

Best Jazz Vocal Performance -- Al Jarreau, "All Fly Home."

Best Jazz Instrumental Performance, Soloist -- Oscar Peterson, "Montreux '77 -- Oscar Peterson Jam."

Best Jazz Instrumental Performance, Group -- Chick Corea, "Friends."

Best Jazz Instrumental Performance, Big Band -- Thad Jones and Mel Lewis, "Live in Munich."

CHILDREN'S, COMEDY, SPOKEN

Best Recording for Children -- The Muppets, "The Muppet Show."

Best Comedy Recording -- Steve Martin, "A Wild and Crazy Guy."

Best Spoken Word Recording -- Orson Welles, "Citizen Kane."

COMPOSING

Best Instrumental Composition -- John Williams, "Close Encounters of the Third Kind."

Best Album of Original Score for Movie or TV -- John Williams, "Close Encounters of the Third Kind."

Best Cast Show Album -- "Ain't Misbehavin'."

ARRANGING

Best Instrumental Arrangement -- Quincy Jones and Robert Freedman, "The Wiz."

Best Arrangement Accompaning Vocalist -- Maurice White, "Got to Get You Into My Life."

Best Arrangement for Voices -- The Bee Gees, "Stayin' Alive."

ALBUM PACKAGES

Best Album Package -- Johnny Lee and Tony Lane, "Boys in the Trees."

Best Album Notes -- Michael Brooks, "A Bing Crosby Collection, Vol. 1 and 11."

Best Historical Repackage -- Michael Brooks, "Lester Young Story, Vol. 3."

PRODUCTION

Producer of the Year -- The Bee Gees, Alby Galuten, Karl Richardson.

ENGINEERING

Best Engineered Recording (Non-Classical) -- "FM -- No Static At All."

CLASSICAL

Album of the Year -- "Brahms: Concerto for Violin in D Maior," Itzhak Perlman with Chicago Symphony.

Best Classical Orchestra Performance -- "Beethoven: Symphonies," Herbert von Karaian, Berlin-Philharmonic.

Best Opera Recording -- "Lehar: The Merry Widow," New York City Opera Company.

Best Choral Performance (Other Than Opera) -- "Beethoven: Missa Solemnis," Georg Solti, Chicago Symphony.

Best Chamber Music Performance -- "Beethoven: Sonatas for Violin and Piano," Itzhak Perlman and Vladimir Ashkenazy.

Best Classical Performance, Instrumental Soloist (With Orchestra) -- "Rachmaninoff: Concerto No. 3 in D Minor," Vladimir Horowitz.

Best Classical Performance, Instrumental Soloist (Without Orchestra) -- "The Horowitz Concerts, 1977-78."

Best Classical Vocal Performance -- Luciano Pavarotti, "Hits From Lincoln Center."

Best Engineered Album, Classical -- "Boulez Conducts Varese."