Larry Neal, the embattled executive director of the D.C. commission on the Arts and Humanities, announced his resignation yesterday at a commission meeting.

Neal, 41, said he will officially leave the $34,604-a-uear post at the end of July. Several commissioners said later that the announcement did not take them by surprise.

Neal's administrative skill has come fire recently in a report prepared for Mayor Marion Barry's transition team, and by members of the arts community quoted in newspaper articles. Last monthe a National Endowment for the Arts committee rejected the D.C. Commision's application for its basic share of federal funds for the next fiscal year.

Neal denied yesterday that he was under pressure to quit. "As weird as it might sound," he said after the meeting, "I didn't resign because of pressure. I like a good fight."

He is leaving, he said, in order to pursue his writing career: "I need to dig into my creative work. I came (to the commission) at a time when I should have been doing something different." Neal has written a play that is scheduled to be produced in New York this summer, and next fall he plans to work with jazz percussionist Max Roach on a Roach autobiography.

The likeliest successor to Neal, according to sources close to the mayor's transition team, is Mildred Bautista. a staff member of the Cultural Alliance of Greater Washington and one of the organizers of the Alliance. Baustista could not be reached for comment last night.

The commission began to organize a search committee for a new executive director yesterday. But no official action is likely to occur until at least eight vacancies on the commission are filled. Barry has nominated eight new commissioners, but the city council has not yet voted to approve them.

"It would be great if the city council acted as swiftly as possible," said commissioner Louis Scheeder. "It's not the job of the commission to lay back now."

Neal's resignation was greeted with mixed feelings yesterday. "I feel both positively and negatively about it," said commissioner Harry Poe. "Larry brought a sense of the future ot the commission, the feeling that something would be accomplished. But toward the end things began to lag. Larry is a true academician. He could not administer the day-to-day concers of the office."

"All of us liked Larry," said a source close to the transition team report that criticized the commission. "But he was no administrator. He was in over his head."

In a statement released at the commission meeting yesterday, Neal said he took this job to bring a little light to this darkness and to make amy mark in the world. It's benn a good romp. We have lost some and we have won some.'

Among the ocmmission's accomplishments, he said, was an increased concern for the arts in Washington, "and we have done the best we could with our resources, both human and material." CAPTION: Picture, Larry Neal; by Craig Herndon