To historians the five-mile Newtown Creek that winds through the Greenpoint neighborhood into the East River is a reminder of past glories. In the early 1800s, this was the young nation's busiest waterway. It thrived with sailing ships. Besides the commerce, the creek's clean and wide waters supported swimming beaches for the citizens and preserves for wildlife.

Today Newtown Creek is poisonous, smelly and dangerous. Industrial waste, human waste, sewage and garbage have been dumped into it with such relentless profusion that it ranks as one of America's most polluted bodies of water. The local citizens--an ethnic and racial mix, with urban decay and high unemployment the common bond--can do without the distinction. They would rather be known for the energies they are putting into the Coalition for Newtown Creek.

It is a group of residents, business people, public health workers and environmentalists who think the creek can still be brought back to life, despite the decades of lethal abuse.

This radical vision is based on nothing more bold than the Clean Water Act, the moderately progressive law of 1972 that is now before Congress for reconsideration.

The fight to save Newtown Creek is of national interest because water quality is an unavoidable health issue in the politics of every American city and rural area. In the past few months, the reauthorization of the clean air law has been the most publicized environmental issue before Congress. But clean water presses with an urgency of its own. We are only beginning to learn, for example, what effect the discharge of 400 million pounds annually of toxic wastes from factories and sewage plants is having on human beings.

One of those in Brooklyn who has learned about the illnesses of polluted water is Sister Francis Kress, the chairwoman of the coalition. She is a 67-year-old member of the Sisters of St. Joseph, a teaching order. For some time, she has made the salvation of Newtown Creek a holy cause only a little lower on the divine scale than the salvation of souls. In fact, her theology of the environment includes the belief that if Newtown Creek were returned to some of the grandeur that God originally lavished on it, the local citizens and businesses would have restored to them a blessing rightfully deserved.

The other day, Sister Francis went to Washington to testify before the House Subcommittee on Water Resources. She made the expected plea that Congress strengthen the 1972 law, not weaken it as the Reagan administration is trying to do. Among her arguments was the seldom heard idea that polluted waterways were threats to people's mental health.

She told the congressmen about teaching grade school in the early 1960s in Greenpoint and wondering why many of her students, languid, seemed to be lagging behind life. "After a while," she said, "I learned that an odor like rotten eggs could be the cause . . . This obnoxious odor was caused by the decomposition of organic matter and raw waste discharged into Newton Creek. In a family situation this could increase the stress factor and very possibly contribute to asthmatic attacks and emotional breakdowns."

When I talked with Sister Francis, her love of children was apparent. She had taught thousands of them in her more than four decades in the classroom. But she believed that Newtown Creek, which could have retained the old-swimming-hole character for the children, was stolen by "greedy and unscrupulous characters."

The words have a judgmental ring coming from a woman of placid bearing. But the anger, which is justified, isn't hers alone. The owners of refineries and factories that line the creek now realize that the waterway's bottom is so lined with sludge -- too contaminated to be dumped elsewhere -- that soon barges may be unable to navigate. The economic losses are as real as the recreational ones.

The fates of hundreds of Newtown Creeks across America will be settled by whether the Clean Water Act is left intact by Congress. In the past 10 years, the law has been amended twice. Both times, fair compromises were made. Water quality has improved in some areas and deterioration stopped in others. Nature does give second chances. The choice now is whether to make places like Newtown Creek symbols of hope or scenes of neglect.