The National Theatre board, after a three-month search for new management, has decided to strike a deal with the Shubert Organization, the largest chain of legitimate theaters, in the country.

"It was the feeling of the board that the Shuberts are the Tiffanys of the theater world," said Harry Teter Jr., an attorney and board member, yesterday afternoon.

In September, the board voted to sever its ties to the Kennedy Center, which had managed and booked the National for five years. Board members were known to be displeased with the quantity and quality of attractions booked into the theater this year. In all, the National will have been shut down for 26 weeks, or half of 197, "and that cost us $7,000 a week," said Teter.

A further aggravation was the reopening of the Warner Theatre last year as an outlet for plays and musicals, under the management of Washington performing arts promoter Sam L'Hommedieu. "He'll do gangbusters with 'Best Little Whorehouse,'" said Teter, refering to the musical that opens at the Warner next month starring Alexis Smith.

Last week, coincidentally, Bernard Jacobs, president of the Shubert Organization, was one of those who attended an informal meeting with three U.S. senators -- Daniel P. Moynihan (D-N.Y.), Bill Bradley (D-N.J9) and Alan K. Simpson (R-Wyo.) -- to discuss programming at the Kennedy Center.

Jacobs could not be reached yesterday, but Teter said that Shubert officials "have absolute confidence that [the National] can be back to its glory. They think it will be the most successful theater outside New York. We hope we'll be able to offer Washington the finest."

If the negotiations with the Shubert Organization are successful, the new relationship would drastically alter the competitive balance of live theater in Washington. Shubert officials have mentioned "Evita," "They're Playing Our Song" and the London hit "Amadeus" as possible attractions for the National next year.