There's been fighting at the school during recess.

Madge Casey gathers a small group of 12- and 13-year-olds about her. Several have told her they are unhappy about the fights.

"What do you want to be when you group up?" she asks.

"A judge," says one. "A basketball player," grins another. His classmates shout agreement.

"All right," says Casey. "Let's have a basketball game."

The students quickly form two teams. "We need a referee," interjects Casey, beckoning to a quiet boy standing off to the side. "And cheerleaders." The four girls divide between the two teams.

The game begins, but it's not like any other basketgall game. There's no ball. It's all acting: dribbling, jump shots, and scores that bring cheers from the rooting section.

Now, says Casey, "What happens when we're playing outside?"

"Fights!"

"Okay, let's have a fight here. But remember, nobody gets hit."

Two students square off, fists waving in each other's faces. Then with a nudge from Casey, the ref steps in, pantomiming a halt.

That ends the game. Now the moral.

With prodding from Casey, the 13 students clustered around her conclude that fighting is not a good way to resolve disputes, and that the referee was right in stepping in.

"The kids clearly have some comprehension of what constructive behavior is," says Casey, "and this reinforces it."

One boy sums it up:

"Instead of fighting it out, we've been working it out."

This special group of students at Patterson School in Far Southwest Washington has participated in a form of psychodrama, a therapy in which, as the name implies, there is an acting out of problems.

Called "Social Living," this paticular approach to problem-solving is being offered in three city shcools by the psychodrama section of Saint Elizabeths Hospital. The schools, two public and one parochial, are in St. eE's neighborhood.

Casey, who spends about an hour weekly with the class, is a psychodrama trainee at St. E's. Working with the teacher and other school officials, she will try to help the young teens come to grips with such growing-up terrors as playground bullies, getting teased, "nobody will play with me," and to deal with parents and other adults.

Earlier in the day's session, casey had the group play the school principal and a judge. The students, she believes, develop self-esteem by taking charge in an authority role.

They also gain an appreciation of grown-up responsibilities.

"What excites me," says Jessica Myers, who heads the relatively new "Social Living" program, "is that it works. My hope is that it will be used in every school in the country. It's preventive mental health."

Unlike classic psychodrama -- where attention may be directed to one individual's particular conflicts -- the focus is on a shared problem.

"No one is talking about a specific person," says Myers. "Children are reluctant to have the spotlight, to be singled out. Most children just adore it and take to it very quickly."

Students who may be shy or have isolating personal problems often can be drawn into the class through "Social Living" sessions.

One student -- perhaps a friend of the shy classmate -- is asked, for example, to play a stranger. The shy student might be encouraged to be one of "the welcoming persons." After awhile, they switch roles.

Finally, says Myers, "We talk about how it feels to be left out and how it feels to be new."

Eventually, as has happened at Patterson, the rest of the class will reach out spontaneously to shy or isolated students.

In an earlier pilot project in a D.C. junior high school, Myers says the program produced these results: Incidents of abuse against teachers stopped, children who often failed to show up started returning to class, a child with poor hygiene habits began to bathe regularly, and a girl who regularly got into fights stopped doing so.

Psychodrama was founded early in this century by Vienna-born J. L. Moreno, who continued to train practitioners at his institute in Beacon, N.Y., until his death a few years ago. The St. E's psychodrama section, says information officer Barry N. Spodak, offers "one of the most comprehensive training forums for psychodrama in the United States."

In impromptu theater vignettes -- often on a stage -- participants "replay what has gone on in their past." With the help of therapists, they attempt new solutions to their problems. By acting out alternatives, say Spodak, "You can take chances and not have to pay for it."

Various techniques, including role reversal, are used.

One client came to Spodak complaining that his wife had just refused to sew up his trousers. The wife said she would show her husband how to do it, but she now had a full-time job herself and he'd have to take care of those things himself.

"I warmed him up to the changes in his situation by putting him in his wife's position." In the role of the wife, the man began to understand her new responsibilities and realize that she might be more tired in the evening.

"We get stuck in our responses," says Spodak. "To Moreno, spontaneity was the height of human creativity."

In addition to working with groups and individuals at the hospital, the psychodrama section aslo uses its techniques to train the Metropolitan Police in crisis intervention -- for example, how to calm down a family fight. And it trains the FBI in hostage negotiations.

Psychodrama also "has emerged as a treatment of choice for psychotherapy with the deaf," says Spodak, where it has proved "tremendously effective" because of the physical action involved.

Myers has begun a new program with Saint Elizabeths mental patients who also suffer severe medical problems, such as paralysis. Here she uses a psychodrama technique called "doubling," in which she assumes the identity of the patient, even to the point of sitting in a wheelchair or lying down on a makeshift stretcher next to the patient.

While a social worker or psychiatrist talks to the patient, Myers speaks aloud thoughts the patient may be holding back -- such as "I'm afraid" or "When am I going to get out of here?" or "Why doesn't he do more to help me?"

She feels the contact she makes with these patients is beginning to help them overcome the rage of depression they may feel because of their confinement, or because many of their family or friends no longer visit.