The halls are alive with the sound of music.

As it does every year, the Museum of American History breathes its particular warm sigh of relief between holidays, opens its arms and pulls people in with the most interesting exhibition of all -- other interesting people.

The museum's stages and corners, filled with music and craft demonstrations, free films, plays and games, are exciting ornaments for the greater display -- The American Family, on the everchanging exhibition that you can be a part of as the ultimate Christmas presence. Between last Saturday and Wednesday, 160,000 will parade through the museum in their coats of many colors, celebrating ethnic diversity and cultural curiosity. It's a guard's headache, this holiday migration; may they benefit from the aspirin of cooperation.

You can spot flash points of activity by the people standing still and applauding the likes of Rapid Rhymin' Rob Peck and his New Year's Revolutions. The jovial juggler is a dozen dropped balls distant from the museum's Atom Smasher, so it's somehow right that Peck is cracking up the audience with bits that defy both gravity and logic. On the second floor, the Chord Foundation is dispensing "Goodbye My Coney Island Baby" in the shadow of an 1892 Froelich tractor. They're as well groomed as you'd expect a barbershop quartet to be; there may not be many barbershops in this day of hair cutteries, but the melodies linger on.

One flight up, Dennis Waring is talking about his wooden friends, homemade instruments that seem a bit embarrassed in proximity to their "refined" cousins in the Hall of Musical Instruments. Waring plucks and bows and picks and strums and blows and brushes at several dozen instruments. When someone asks him to translate into monetary terms the time put into each instrument, he looks confused and finally admits they are "labor-intensive projects" that can't be priced. The wide-eyed onlookers who stick around are figuring out which instruments they're going to try to put together first . . . just as soon as they get home.

Katharine Hepburn and Joan Bennett flicker on the Carmichael Auditorium screen as "Little Women," followed by a lively (and abbreviated) version of Dickens' "Christmas Carol." Near the ongoing timekeeping exhibit, Bob Dahmer pokes a clock together while William Chabot demonstrates the breathtaking art of hourglass blowing. Other crafts people teach the curious how to decorate their lives; elsewhere it's fun and games (whist, cribbage and checkers) for those who want to take a load off their feet while putting a load on their minds.

At the pendulum area, things swing in a different fashion. The National Capital Area Band of the Salvation Army plays bravely -- and warmly, for once. They give a particulary emphatic reading to "When the Roll is Called Up Yonder I'll Be There." Their somber uniforms are unintentional easement to eyes that will be dazzled when the Aqua String Band of the Philadelpia Mummers Association trot out in Shriner-style costumes that look like they were designed by the NBC peacock.

"Hey, John, look at these guys!" said one dazzled innocent, and indeed, the Aquas got an ovation simply for arriving on stage. There is an emphasis on bright green, pink and orange, feathers, bows and fur, with a lot of gold trim. With saxes, old-time banjos and glockenspiel, the Aqua String Band sounds very much like the huge, automatic Orchestrion that used to get the folks dancing in the aisles of the museum a few years ago. But the Aquas are alive, thoroughly enjoying tunes like "On a Wonderful Day Like Today."

Caution: There are only three more wonderful days like the two that have just passed. You will still have time to hear Irish and Jewish folk music, jug band dance tunes, gospel trios and madrigal ensembles and taste goodies from Bulgaria, Germany and Greece -- you know, all the things that make this a Nation of Nations.

Hurry, hurry, hurry. And listen in on people's conversations in this museum already filled with fascinating sights and sounds. It's yourself you'll see and hear, and you are very interesting.

The holiday celebration at the Smithsonian runs through Wednesday from noon to 5 p.m. All events are free. For schedule information, call 357-2700.