The man in the gray sweatsuit and twirling propeller beanie boogies up to a woman in a winged space suit and waves at another in a black leather suit with flashing computer lights. Another dancer, in tin-foil running shorts, glares at a woman doing exercises in a clear vinyl tutu.

The spotlight turns on Cherry Vanilla, a New Wave singer in a pink Bozo wig. In front of her, rock guitarist Albert Crabtree, wearing a blue feather boa and gold satin designer baggies, is smashing his guitar against the floor.

This is not New Year's Eve at the Mudd Club or Studio 54. It is the unlikely finale to an hour-long presentation of the creations of the new crop of fashion designers dubbed the Innovators.

The 60 or so dancers lighting up the New York Hilton are the Innovators themselves, selected by a small committee headed by Terry Melville of Macy's and Carol Troy, coauthor of "Cheap Chic." The show was sponsored by the Fashion Group, women executives in the business, and by more than 1,000 manufacturers, retailers and "established" designers who were in the audience.

The Innovators work mostly out of store fronts, and lofts in New York, though a few came from other places as well. Their names are hardly classic. But they may be, someday. According to Melville, they are where designers such as Cathy Hardwick, Stan Herman and Clovis Ruffin were a decade back.

"When you start a new decade people start thinking about the future and are more receptive to change than at any other time," Melville insists. While most of these designers have small enough businesses to be free of big production responsibilities, some, like Isaia Jose Antonio and Michael Sultana, have started selling their wares all over the country.

If the clothes at the start of the 1970s sprang from the obsession with outerspace and became an object for literal translation, the Innovators don't have such guidelines. In fact, their inspiration is their imagination, their fantasy. Thus the Buck Rogers-Sci Fi translations, punk costumes and New Wave music.

And if the goal of the last crop of designers was to look young because they were young and felt they wanted to stay that way, that is no longer the vogue.

One reason is that these designers are no longer as young. "Do I have to tell you my age?" pleaded two of the women. Many are in their thirties and trained in establishment places in the last decade.

The only familiar name in the lineup is Betsey Johnson, princess of psychedelic fashion in the 1960s whose stretch clothes have been selling for more than a year. With her spikey, now silvery hair (it's been jet, blond and red on and off recently) she was dancing in her fringed mini at the show.

"These clothes are neo-'60s, not hard-core," says Mark Sawyer, fashion consultant to Fiorucci, the boutique to first showcase many of these designers. "Clothes aren't as tough and slutty as they were in the 1960," he says.

What also separates the current crop of clothes, with their strong colors and shapes from a decade back, is their visual impact. "This new era is very visual," says Carol Troy. "Visuals are what count. Posters, shopping bags, the oversized mags like Interview, Night, Wet, Ritz that give credits to models, haridressers, stylists and photographers as well as the clothes."

And the show was almost totally visual. The major part of the presentation flashed on a curvey screen that stretched more than half way across the Hilton ballroom. The audience loved it. But when the slides and film went off and the designers danced on stage in person, the enthusiasm cooled.

Melville defines the appeal of the clothes as garb that is neither expensive originals, nor cheap knock-offs. "There is a whole new generation that doesn't want to look like their parents," she says. "Not 1960s anti-fashion with jeans and hippie stuff. They are influenced by fashion and like fashion but want to do it their own way."

Ellen Ann Dobrovir, one of the designers who was wearing a spark plug from her motorcycle as a pendant, agrees. "My thing is fantasy. My dream was to be a ballet dancer," she says curtsying in her pink tutu.

Sally Beers says that she has done bras, belts, even suits with battery operated flashing lights mostly because no one has every done that before. "And I like it . . . it has a future look," she says. "It gives me the feeling that I'm building something."

If the test of fashion is in the selling, there already is some movement. The design studio, Confetti Sport, has a retail store in Chelsea with most customers, according to Michael Sultana, between 18 and 35 looking for "progressive evening clothes," as he describes them. "Nothing classic or what others are calling contemporary," he says.

Other stores, including Fiorucci, Dianne B. Macy's, Bloomingdale's and Commander Salamander in Washington, also carry some of these designs.

"Now European shops and magazines are also coming to see and buy these things," says Terry Melville. That, she says, is the ultimate test.