ARENA STAGE'S production of the musical "Candide" is a wondrous toy chest. Part magic kit, part jack-in-the-box, it is chock full of puppets and Pygmies, dolls and doll houses, stuffed sheep, squirting clams, Halloween skeletons, model ships that sink into the sea and who knows what other playthings to amuse a prankish God.

This may be the American theater's most frolicsome serious musical, a hill-and-dale gambol over two continents to the bauble-bright score of Leonard Bernstein. At the root of the gilded enterprise is Voltaire's enduring tale about a sweet fool, Candide, his lighthearted ladylove, Cunegonde, and the obstacle or fifty that separate them on their way to the altar. But God's got more to do with this frisky evening than you may want to acknowledge at first. While Arena is out to provide a merry old time, it is also willing to give Him His due. And it does so in a dazzling show of wisdom and stagecraft.

The first thing you'll notice about this production is the handsome study that is suspended over the stage. This is Voltaire's abode, done up in red and gold. Voltaire himself (the ever deft Richard Bauer) is there at his desk, ready to recount the saga that's about to unfold beneath him and even participate periodically in the action, as that eminent philosopher and idiot, Dr. Pangloss.

The second thing you will notice is the stage floor itself, which has been laid out rather like a formal French garden with sunken pits for the musicians where the flower beds usually are. But secreted in the deceptively elegant parquet are enough trapdoors to stock a fun house. No sooner has Dr. Pangloss delivered himself of his belief that "everything is for the best in this best of all possible worlds"--and his young charges have echoed their firm agreement--than all manner of mayhem breaks loose. War, pestilence, rape, pirate attack, robbery, shipwreck, earthquake--not to mention the bonfires of that all-time Mardi Gras, the Spanish Inquisition. Job had it easy compared to Voltaire's chipper crew, struggling to stay chipper.

The trapdoors pop open and out come miniature soldiers with booming blunderbusses. People turn into puppets and then the puppets turn around and transform themselves back into people. When our hero and heroine have to beat a fast retreat, their flight is depicted with cardboard cutouts, passed from chorus member to chorus member. Let Cunegonde (Marilyn Caskey) bring down the house with "Glitter and Be Gay"--that wickedly delicious aria that holds that a woman's virtue is a jewel, but then so is a necklace proferred by a wealthy admirer--and the trapdoors pop open again. This time, it's to reveal dozens of opera aficionados, pitching roses.

If "Laugh-In" had existed in the time of Marie Antoinette, it might have looked something like this. Director Douglas Wager and his extraordinarily inventive designers (Zack Brown, Marjorie Slaiman and Allen Lee Hughes) haven't left a trick unplayed or a toy untinkered. Not only is the elegant world of Fragonard being gleefully fractured, but, you might say, mustaches are being drawn on the faces of the pretty ladies, as well.

It didn't take long to occur to me, though, as it will no doubt to you, that Arena is being more than just excessively rambunctious. It has created a rococo booby trap and then encouraged a zestful cast to go for the bait each time. In doing so, it has given us a contemporary metaphor for a backfiring universe in which men, for all their fanaticism, count as rag dolls and destiny is just one impractical joke after another. God may be in his heaven, but earth seems to rest on a cosmic whoopee cushion.

Not so curiously, despite the brilliance of Bernstein's score, "Candide" failed in 1956 as a far more traditional Broadway musical. Voltaire's characters, after all, are batted well beyond the usual conventions of the proscenium stage. It was not until Harold Prince revived the show in 1973, with a new book by Hugh Wheeler to replace the heavy-handed script originally cooked up by Lillian Hellman, that the show finally came into its own. Prince had the brainstorm to spread the action over a series of little stages connected by catwalks and drawbridges that snaked around the audience itself. Arena's production builds on that basic conceit, but has had the further inspiration of raiding the toy shop for its props and ploys.

Yet it has to be acknowledged that the explosive staging has been purchased at a certain cost. In general, the music has been nudged aside by the pyrotechnics. Singing in the round is tricky business at best, but with all the competition at Arena, it is made even trickier. Lyrics regularly get lost, and when they are as quick and witty as those John LaTouche, Richard Wilbur and Stephen Sondheim provided for the occasion, the loss is triply regrettable. Asking Theodore Pappas to choreograph an auto-da-fe' or the occasional bacchanal in these maze-like quarters is rather like expecting the Navy to conduct maneuvers on Walden Pond. Pappas' dances are nonetheless unusually banal.

Caskey is certainly a matchless Cunegonde and she has a worthy mate in Paul Binotto, as the hapless Candide. Their duets together strike the fine balance of soaring lyricism and operatic parody that is key to the functioning of the musical. But John Jellison, as the self-infatuated Maximillian, is not especially gifted in the art of comic preening, and as that accumulation of disasters, the one-buttocked Old Lady, Olga Talyn has yet to fully exploit the potential of her big, boastful number, "I Am Easily Assimilated." In various cameos, Joe Palmieri and Terrence Currier are employed to colorful effect, although some of the supernumeraries seem to be overbidding their hands.

Still, the essence of this "Candide" is surprise, and Wager is very resourceful about concocting one after another. The very best comes last, and it may be the best because there's no trick at all on the horizon. Having wandered far and wide in search of happiness, the characters have come reluctantly to the conclusion that "this best of all possible worlds" is just a world and it's made tenable only through the sweat of our daily labor. Dressed in the somber hues of Millet's peasantry, they stand as tall as their chastened dignity allows and sing the stirring finale, "Make Our Garden Grow." It is almost a hymn to our tenuous status in the cosmos.

Above them, as their voices mount in fervor, is Voltaire, the author--or maybe God, the creator. He's back at his desk, scribbling new tales or putting order in old ones, but oblivious to the humble creatures who have finally made their peace with Him. Arena's astonishingly lively production about a wee, wicked world just may be a meditation on art and the artist, as well.

CANDIDE. Music by Leonard Bernstein. Book by Hugh Wheeler; lyrics by John LaTouche, Stephen Sondheim, Richard Wilbur. Directed by Douglas Wager; choreography, Theodore Pappas; musical direction, Robert Fisher; sets, Zack Brown; costumes, Marjorie Slaiman; lighting, Allen Lee Hughes. With Richard Bauer, Paul Binotto, Claudine Cassan, Joe Palmieri, Marilyn Caskey, John Jellison, Olga Talyn. At Arena Stage for an open-ended run.