THERE'S ONLY ONE worry about "Barfly" -- it might be too much fun. Henry Chinaski, after all, is a derelict living in utter despair. His face is a history of bar brawls and liquor abuse; his clothes and hair are matted with blood, sweat and booze. So why are we laughing?

Because Mickey Rourke, who plays Henry, infuses the character with swaggering pathos. Because Charles Bukowski (his script based on his Boho-boozy L.A. past) has written with blustery, romantic -- but not sentimental -- zeal. And because director Barbet Schroeder lets Rourke and Faye Dunaway create a charming flea-bitten affair.

They meet at the Golden Horn -- two parts bar, one part purgatory, this L.A. dive is a refuge to the drunks and whores and downs-and-outs. Henry likes to get there early (that is, before lunch) to cadge drinks from friendly day bartender Jim (J.C. Quinn). Later, he might goad macho night man Eddie into another in a series of back-alley punchouts. Henry wins, mostly because his will (and sense of dignity) is stronger.

When Wanda (Dunaway), a greasy beauty, shows up, it's love at first slug. She's a perfect partner, wanting no more from life than to keep her glass filled, and she has a certain sullen elegance about her (Henry describes her as a "stressed goddess").

"I can't stand people," she says. "You hate them?"

"No," Henry says. "But I seem to feel better when they're not around."

Ah, love. They begin not so much a sentimental love affair as a partnership in vice. She's ready to run off with anyone with a fifth of whiskey; he makes a brief foray into the world of the rich and famous for a roll with an upscale homeless-chic editor (Alice Krige). We learn nothing of their past -- only that they have escaped it.

Occasionally, a Statement Alert flashes past. Says a bartender of Henry: "He's as right as any of us." And, after bedding down with the editor, who publishes one of his Bohemian stories, Henry calls her expensive home "a cage with golden bars."

But these are minor bugs in a highly watchable slice-of-low-life entertainment. If this isn't her best role, it's Dunaway's gutsiest. And Rourke certainly has found his best role (and this, after the disastrous "A Prayer for the Dying," couldn't be better timed). As Henry Chinaski, he's not so much a loser as an update of Chaplin's Tramp or the magnificent bum Boudu in Jean Renoir's classic "Boudu Saved from Drowning" -- tattered gentlemen who opt for the ragged life. BARFLY (R) --

At area theaters.