A year ago it was merely a novel idea, but last night it became the Great Washington New Year's Traditional Bash with a cachet all its own -- a big rollicking downtown street party in front of the Old Post Office Building with blaring bands and a "Love U.S.A.," giant, electrified postage stamp.

And inside the tiered grand hall an equally diverse crowd had transferred their Washington reception manners to small clusters of conversation and celebrity spotting. But no matter who was doing the talking, the talk was about how good the party was for the people and the town.

"We never thought folks would be daring enough to plan something like this," said School Supt. Floretta McKenzie as she leaned on a balcony inside the Old Post Office Pavilion. "The city is becoming much more cosmopolitan."

A total of about 65,000 gathered inside and outside on Pennsylvania Avenue to welcome the New Year.

On the surface, Washington's public party may resemble any other gigantic bash, but in fact it offers substantial evidence that the city can at least fantasize about taking on New York as the nation's New Year's Eve capital. Mayor Barry is the prime booster in this new contest: "We think it will be the most exciting public celebration in the nation," he said, "even surpassing the celebration in Times Square."

Barry added after midnight last night, "Absolutely, this has been a success. Look around and see the cross section, how the young, old, white and black, all people, have come together and are genuinely having fun. No one really had to create this mood."

Last night's event was also another signal that a New Washington -- a Washington of renewed civic pride and spirit, of booming prosperity for its business and political segments and of growing human interaction and physical focal points -- is being created.

Barry, his Committee to Promote Washington, and local citizens all worked to get the message out beyond the Beltway that Washington is attractive, unique and unified.

"We are trying to put this celebration on a national scale, to show Washington as a good place to live, to work, to visit," said Maurice Cullinane, president of the D.C. Bankers Association and chairman of the mayor's promotion committee.

Such talk is music to the ears of Washington's businessmen. Tommy Mack, president of Tourmobile Sightseeing Inc., said, "This is just one other way to portray Washington as the important city it is. I see it further as a tool of unity, to have citizens from this community come together and share an important event."

Barry's skill at promoting Washington was one factor cited by celebrants as making last night's party special. Said Herbert Haft, chairman of the Dart Group Corp.: "Marion Barry is the catalyst for this. He was elected on the slogan 'D.C. on the Grow,' and when you go downtown and see what is happening, it is true.

"I just like the feel of the city," said Haft, who in previous years attended private parties on New Year's Eve. "And Barry takes the knocks when things are not right, so he should have credit when they are right."

As the quality of life and business improves, interpersonal attitudes are changing.

"I have sensed that in the last few years, Washington has gotten ahold of itself. You can't look at the skyline without seeing cranes all over the place, and the development of Pennsylvania Avenue, the development of night life. It is not like it used to be when people exited the city at 7 p.m.," said Cullinane, who, as a former police chief, remembers the worst of times for city unity. "The city went through some very trying times. What you see now is the result of hard work by a lot of people."

Marty Wall, the promotions director at radio station WRQX, one of last night's sponsors, pointed out the Fourth of July concert on the Mall, the Georgetown Halloween party and Adams-Morgan Day as other signs of a new Washington. "I feel a new-found pride. The radio station is having more events in the city, the suburban people are coming in and enjoying it. You see clean taxicabs and clean buses," said Wall.

"The very fact that the city is issuing bonds is a sign we are growing up. I have always felt good about the city, but with the subway, the new development, the practical thinking in the government, I am bullish about the city," said attorney Michael McKenzie.

The guest list for the mayor's reception inside the Pavilion at Cafe Maxime illustrated the effort at civic cohesiveness. Expected at the small reception for 125 organizers and supporters of the events were: Maurice Turner, the D.C. police chief; Carmen Turner, the general manager of Metro; members of the D.C. City Council; Andrew Ockershausen, vice president of radio station WMAL; Ernest Fears, vice president of WRQX; Norman Hayter, general manager and area vice president of Pepsi-Cola Bottlers of Washington; Michael Minnig, president of American Potomac Distributing Co.; James Williams, president of Urban Properties; and Larry Johnson, public relations director for Safeway Stores.

Many of the businesses helped finance the party, which cost the city $127,000. For example, 24 local hotels offered discount rates for the night.

The atmosphere in the early part of the evening wasn't that much different from a crowded Sunday afternoon.

People ringed the tables on the lower floor of the Pavilion, while many others looked anxiously upward to the 5,000 balloons tied to the rafters. A huge banner proclaiming " '85 Comes Alive" provided the holiday backdrop for the Mike Crotty Orchestra. Couples leaned over the railings and peeked through the windowless frames to watch the jockeying for seats.

But as the crowd grew through the night, the atmosphere changed accordingly -- becoming noisier and, as the countdown toward midnight approached, increasingly celebratory.

Before the countdown, Barry made brief remarks from the bandstand. Above the noise of horns and cheers, the mayor managed to start a chant, " '85 Comes Alive!"

Watching the mounting frenzy, City Council Chairman David Clarke said, "Washington is not just a dull political town. Most of the national politicians are out of town. This is our event, and when we want something to celebrate, we just erupt."

As midnight approached and the brightly lit stamp was slowly lowered on a cable, the crowd outside started shouting wildly. Champagne and beer flowed, young men climbed trees and stoplight poles and a group of kids placed a wool winter cap on the Post Office's statue of Ben Franklin.

Just before midnight, the mayor, his wife, Effi, and Clarke joined the Four Tops on the stage for a dance and a roaring chant of " '85! '85!"

The 450-pound, 20-foot-high stamp -- a rainbow of colors with the word "Love" in lavender and "U.S.A." in red -- came down right on time.

Horns blared, strings of firecrackers were set off as people launched into renditions of "Auld Lang Syne." People embraced and screamed and shouted. They kissed passionately. The singing, if it could be called that, was led by the Four Tops. The crowd was bathed in theglare of television lights.

Inside, the crowd, now bobbing with electric gold and blue hats, watched the final countdown on a large screen behind the bandstand. When the stamp was lowered, the words "D.C. Comes Alive" flashed on the screen and the final seconds of 1984 were drowned out. To usher in another high-tech feeling, the words of "Auld Lang Syne" were flashed on the screen as the crowd kissed, hugged, sang and reached for clouds of balloons.

Throughout the evening, finding a place to sit was a major sport both in the open areas and at the private party hosted by the mayor. "We're going to see how long we can hold out," said Gary Gunn, an insurance agent, who was leaning up against a store window with his wife Zanette. "We were going to come last year, but we heard how crowded it was and never got here. But we think this is good anyway. It is trying to bring the city alive," he said.

Marty and Celeste Lagoy spent last New Year's Eve on the Avenue but managed to make it inside last night. A buyer with the Georgetown University Shop and a native Washingtonian, Lagoy said he thought the city was on its way to establishing a major event. "I love D.C. and wouldn't go anywhere else for this holiday. The city is really changing."

In the pre-midnight hours, the great bells of the Post Office pealed out their boisterous message, and the Avenue was closed off as the thousands of boisterous celebrants -- young and old, urban and suburban -- gathered. Among the performers were the Slickee Boys, Stacy Lattisaw, Roy Ayers and comedian Sylvia Traymore.

As a damp mist drifted over the crowd and a breakdance group called the Mighty Poppolots blared their music, many people in the crowd began dancing energetically themselves. Two students from Washington's Duke Ellington School of the Arts, Michael Thomas and David Whitley, danced in tandem. "I think it's great!" said Thomas of the outdoor event.

An older couple, Joe High and his wife Rozella, stopped nearby to watch. They had come downtown from their suburban home in Alexandria after seeing the night's events advertised on TV. "We're gonna walk around till midnight if we can hold out," High said.

Ken Brill, a 24-year-old paralegal, waxed philosophical as he drank beer. "It's a total experience," he said. He said that he and his friend, Peter Khoury, were "just discussing the fact that 1985 is coming. Reagan's in the White House . . ."

"We made it through Orwell's year," Khoury broke in.

"Right! And nothing happened!" said Brill. "It wasn't Orwellian.

"I hate to use the word nice," he said, "but it's very nice that we can get everybody downtown like this and have a party."