Elsie Berry's story is the stuff advertising blurbs are made of.

She was two years away from retirement and dreading the long, empty years ahead when she saw a correspondence-course ad in a travel magazine. Studying at her own pace while still employed as a railroad clerk, she completed the program in three years and today, at 67, works full time as a travel agent in Cockeysville, Md.

"That ad," she says, "changed my life."

Since their appearance in the early 1900s, correspondence schools have been plagued by image problems. Even with an estimated 3 million students, and such well-known graduates as former U.S. Sen. Stuart L. Symington and "Peanuts" cartoonist Charles Schultz, many Americans still consider correspondence schools shady fly-by-night operations that do the bulk of their advertising on matchbook covers.

Those days aren't completely over, but home-study schools are gradually earning the respectability they've sought for so long--the kind that comes with success.

While other schools battle declining enrollments, home study or "proprietary" school enrollments are growing by approximately 25 percent each year. Small, disreputable schools have given way to larger, established businesses with liberal refund policies and tuition-payment plans. Subject matter is no longer limited to high-school completion, art and TV repair. Schools now offer more than 1,500 courses, including yacht design, wine appreciation, stock-market science, landscape design, paralegal training and robot-building.

Colleges and universities are also cashing in on the public's thirst for home learning. Sixty-nine schools across the country, including Purdue University and Pennsylvania State University, offer 12,000 credit, noncredit and graduate-credit courses, often at half the cost of on-campus study. At last count, nearly 240,000 students were taking college-level courses through the mail, and school officials expect that number to increase 10 to 15 percent each year.

Why the sudden boom?

"People are scared to death," says Michael Lambert, assistant director of the federally-approved Home Study Council, the body that accredits proprietary schools. "They see people being laid off in their department, so what do they do? They send their money away to that ad they saw in Mechanix Illustrated. It's a risk, but they're determined second-income earners."

Of the country's 375 proprietary schools, only 77 are accredited by the Home Study Council, which means that the school lives up to its promises, maintains a qualified faculty and offers the dissatisfied student a partial tuition refund.

Few proprietary schools offer college credit, although some have credit-transfer arrangements with a college or university. (Columbia Union College in Takoma Park, Md., for example, gives credit for certain courses sponsored by the Home Study Institute, also of Takoma Park.)

In most cases, those taking college-level courses are trying to finish an academic degree. To receive credit, one or more examinations are required. The school arranges for a proctor to administer the test at a local high school or college.

Lee Samuels was working on his bachelor degree at the University of South Carolina when he ran into some serious financial problems. Moving to Washington to live with his family and save money, he found a temporary job and now takes correspondence courses from the university to meet his zoology/biology degree requirements.

"It's hard work, but it's worth it," says Samuels, 26. "There's no way you can cheat. There's no one to rely on except yourself . . . I couldn't have afforded it any other way."

Lambert calls Samuels and others like him the country's "secret learners." The typical student is an adult, self-motivated male who's trying to learn a second money-making skill or fulfill a dream in the privacy of his kitchen or study. "If they fail, they fail," says Lambert. "No one has to know about it."

If they succeed in finishing the course, he says, it often tells the prospective employer that they're a mature, responsible person.

Perhaps the most attractive feature of home study is flexibility; students can take several years to complete a course, putting aside as little as two hours a week for study. College and university courses aren't quite as open-ended; students usually must finish the course within a year.

Cost is another asset, although home-study courses aren't cheap. The typical program costs $400 to $700, payable over a two-year period. Still, says Lambert, that's often less than courses covered in one location, and cuts out many hidden costs: fuel, textbooks, student activity fees and parking, for example.

College- and university-sponsored courses are even less expensive, ranging from $15 to $75 a semester hour.

The key to a successful home-study program is simplicity: Instead of a textbook, schools use a lesson-by-lesson approach with plenty of illustrations, quizzes and study aides.

Here's how one school, the New York School of Photography, works:

The student makes a downpayment on the $300 tuition fee and receives the first of 30 lessons and an accompanying instruction cassette (the cassette player is provided by the school). The student completes the assignment and sends the worksheet and photographs back to the instructor, a professional photographer, who uses a transparent overlay to critique the student's work.

The assignment is returned promptly, usually with 20 minutes or more of recorded comment from the instructor.

"A correspondence school puts you in a one-to-one relationship with the instructor," says Dr. Kenneth Young, executive director of the National University of Continuing Education, the body that accredits college and university home-study programs. "If you enroll in the standard freshman class at the University of Maryland, you'll be one of 500 students. The instructor may not always be available to answer questions."

The advantages of home study are countered, however, by some serious disadvantages. Home study, like fiction writing, is a lonely business. Some people work better when they're able to compare their work with other students. Mail delays can be frustrating, preventing the student from proceeding to the next lesson. Some of the technical courses, like small appliance repair and electronics, can be dull, although schools try to keep the assignments as interesting as possible by using diagrams, charts and photographs.

In essence, the correspondence students should have a certain amount of drive. Young offers this scenario: "You're sitting at the kitchen table with your accounting assignment. It's midnight and you've got to go to work the next day, so you put it off."

That's where the trouble begins.

In choosing a school, Young suggests going by the accreditation of a Department of Education-recognized body. Don't hesitate to ask the school for the names of former students. Their opinions may mean the difference between a learning and a losing experience.