Is there any stranger human habitation on Earth than this?

In Norilsk, 200 miles above the Arctic Circle, the sun does not rise for three months a year, the winter temperatures remain under 30 degrees below zero, and the air is, literally, the dirtiest on the globe. Yet there is a full-blown city of 230,000 here, whose citizens are fierce local patriots with a romantic sense of their own uniqueness.

They live in a place created by zeks, political prisoners who populated Joseph Stalin's gulag -- perhaps 100,000, or even 200,000 died in its building; the exact number is lost or buried in still-sealed archives. They were inmates in an unimaginable chamber of horrors, a community of prison camps designed to create nickel and copper industries, and to kill people. It succeeded impressively on both counts.

Modern Norilsk is populated by descendants of those prisoners, among many others, and the city remembers its horrific past. This is unusual in Russia, where forgetting is easier. On the busy streets of Norilsk in August, with pretty women on parade and children chasing each other on bikes and in-line skates, that past seems so remote as to be unreachable.

But it is not. Someone 65 years old today was born in the first year of maximum horror here -- 1936. There was nothing near Norilsk then but a primitive camp set up by the first prisoners, who arrived in 1935. Five arctic winters later there was a functioning nickel smelter whose production was carried to the Yenisey River port of Dudinka, about 50 miles away, on a railroad line that was the zeks' first accomplishment. The nickel went into the tanks and other armor that saved Russia, and perhaps the rest of Europe, from the Nazis.

The original nickel factory is still in operation, belching noxious pollution above the old section of town. It is one part of a mammoth, and largely superannuated, industrial complex here of smelters and factories that produce huge quantities of nickel, cobalt, copper and palladium, the key ingredient in catalytic converters that clean the exhaust of automobiles. Norilsk Nickel Co. has perhaps two-thirds of the world's reserves of palladium. It currently produces nearly half the world's supply (South Africa is the only other large producer).

Now that Russia has joined the capitalist world, Norilsk can make mountains of money. Last year the company that owns Norilsk Nickel reported profits of about $1.5 billion. The controlling owner, Vladimir Potanin, is one of the youthful Moscow oligarchs who dominate the Russian economy. He got control of Norilsk Nickel with an initial investment of about $170 million.

We first saw Norilsk at dawn after our plane landed at 5:20 a.m. We drove from the airport through the rolling tundra, a kind of subarctic desert covered with low-growing scrub. The uneven road jounced us up and down, the inevitable consequence of trying to put asphalt on permafrost. This layer of permanent ice, just below ground, melts slightly in summer and refreezes in the fall. Norilsk is built on it.

We saw the first big structures: a cluster of towering blocks of apartments, nine stories high, that were entirely empty, their windows removed or broken. Then a hillside of small pines, no taller than about 20 feet, half of them dead, the other half missing most of their needles. Then part of the explanation for the state of the trees: two huge smokestacks, perhaps 180 feet high, expelling thick streams of smoke. This was Norilsk's most modern factory, 20 years old. It has the improbable name of Nadezhda -- "Hope." The smoke was so thick that it blocked our view of a spectacular orange sun rising behind the plant.

Between Nadezhda and the city itself, the tundra was crisscrossed with electric power lines and fat, rusting pipes. In Norilsk, perhaps the ultimate company town, the interests of "the Kombinat" have always come first, so littering the countryside with industrial detritus was the natural thing to do.

Then, abruptly, the city began. It is probably the most cleanly laid-out city in Russia, all on a regular grid. Architects from St. Petersburg (then Leningrad), joined by architects among the political prisoners of Norilsk, designed the town in the late 1940s, and it took shape in the early 1950s.

Some of the oldest buildings are fine examples of mock-classical Russian architecture, reminiscent of St. Petersburg. The main street, Lenin Prospekt, is lined with buildings five to eight stories high, and ends in a handsome circle dominated by the facade of the Kombinat's big headquarters. Nearly every building showed signs of the annual struggle here against nature: crumbling concrete, rust, bare wood.

This decaying mock grandeur was strange enough, but the bigger surprises came in human form -- Ludmilla Proskuryakova, for one. A round, energetic woman of 49 with a gravelly voice, Proskuryakova runs the Businesswomen's Association of Norilsk, an active nongovernmental organization. Her reputation as outspoken and independent led to speculation that she might tell us the truth about the horrors of living under constant bombardment from sulfur dioxide in dark, freezing, endless winters.

Not exactly. Proskuryakova has lived in Norilsk for only 14 years (she came to join her fifth and last husband -- "that experiment is over," she explained), but she is a confirmed Norilsk chauvinist. "Norilsk is very special," she said; the people here enjoy unusually trusting and intimate relationships, based on their shared experiences in a harsh environment. She is also struck by the cosmopolitan quality of the city, whose residents came from all over the old Soviet Union, a most unusual mixture for Russia. She couldn't imagine living elsewhere.

What about the pollution? "The effects are awful," she readily acknowledged. But she's used to it. In the three days we spent here, we heard that again and again: "I'm used to it."

This loyalty to the city conflicts with the stated desire of the Norilsk Nickel Co. to cut its workforce and reduce the population of the city, which the company has to support with taxes and direct payments. According to Alexander Lamzin, production manager of Norilsk Nickel, the number of employees has fallen from 125,000 in 1996 to 70,000 today, while production has increased. Because all the city's food, consumer goods, building supplies and more have to be brought here over vast distances, maintaining one person in Norilsk is several times as expensive as supporting an ordinary citizen "on the continent," as people here refer to the rest of Russia.

This summer the World Bank gave the Russian government a loan of $80 million to subsidize residents of the far north who agree to move to more congenial climes. Norilsk is one of the targeted communities for a pilot project. It is being administered by Mikhail Soyref, who used to work for Norilsk Nickel, then moved to St. Petersburg in 1998 so he could be closer to his sick mother. He found an apartment and a job in an aluminum factory. After 18 months in St. Petersburg he was offered a job back in Norilsk. Soyref, 46, quickly discovered that his wife, son and daughter all missed Norilsk and wanted to come back, so in 2000 they returned. Now it's Soyref's job to see if other Norilsk citizens, mostly older ones, can be persuaded to move away with cash benefits, counseling and other services.

"Some sort of myth arose for the World Bank that lots of people want to leave here," said Marina Govorova, 46, the chief editor of Zapolyarnaya Pravda ("At-the-Pole Pravda"), the leading local newspaper and an organ of the city government. The World Bank loan is designed, initially, to help about 15,000 people move from Norilsk to other parts of Russia. "At most," predicted Govorova emphatically, "5,000 people will go."

Meanwhile, thousands of others are trying to sneak into town, where permission to reside is hard to come by.

Why? Because in Norilsk there is money to be made. It was always so, once the commissars in Moscow stopped relying on slave labor to build and run the mining and metallurgical operations here. In Soviet times Norilsk workers earned about 2.6 times as much as their counterparts on the continent.

Today, Norilsk Nickel pays wages that average about $800 a month, 10 times the average pay in other parts of Russia. The company will hire only the children of its own workers now, but the cash it puts into the local economy attracts others to town. Norilsk authorities want the federal government to formally close the city to any new residents, a move that would appear to violate the post-communist Russian constitution.

One of nickel's uses is in hardening steel for armor, and in 1935 Stalin was desperate for it, given the rise of Nazi Germany. So Stalin ordered the arrest of several hundred engineers on trumped-up charges and sent them off to Siberia under the command of the NKVD, precursor to the KGB.

This advance party spent the winter in flimsy barracks and tents. They would awake with their hair frozen to the surface they had slept on, according to Irina Sorokina, 32, an historian who works at the city's Museum of History. In 1936 those who survived the winter were joined by thousands more, including leading intellectuals and Communist Party officials arrested in Stalin's purges.

Many were shipped up the Yenisey River to Dudinka in boats intended to transport logs, not people. Years later one prisoner described the trip: "A cattle transport would have been organized more humanely. . . . Only monsters could have planned something like this. We couldn't even stretch out on the damp, naked boards."

Soon a new encampment, this one in Norilsk, had an extensive graveyard at the bottom of Mount Schmidt, a barren hulk of gray stone and coal rising into the sky near the edge of town. Every week more bodies were added, sometimes hundreds at a time. To this day, when the snows on Mount Schmidt melt in June, the eroding streams of water coming down the mountainside throw up human bones.

Since the late 1980s citizens of Norilsk and the descendants of those who died here have taken steps to memorialize this place. Citizens' protests blocked a plan of the Kombinat to build a new structure atop the old cemetery. Then a local businessman raised money for a memorial chapel that was built in 1990 next to the burial ground. The blue and white chapel is capped by an onion dome made of sheet metal. Brides come to the chapel to leave flowers on their wedding day, a modern version of an old Soviet custom of putting flowers by statues of Lenin or World War II heroes.

In the '90s war veterans from the three Baltic republics, Estonia, Latvia and Lithuania, built memorials to the thousands of their countrymen who had died in Norilsk. Then a monument was built to honor Polish victims.

This summer a fourth monument appeared unexpectedly, a belfry made of logs in the style of an old Siberian log cabin, with three locally cast bronze bells that visitors can clang. On the belfry -- completed just before a July visit to Norilsk by World Bank President James D. Wolfensohn -- is a plaque:

"To the memory of the political prisoners of the Norilsk camps, 1935-1956, from their grateful descendants. Norilsk Nickel Co."

The complete "Siberia Diary," including reports by Robert G. Kaiser and photographs by Lucian Perkins, can be viewed online at smoke that pours from Norilsk Nickel's Nadezhda ("Hope") plant helps make the Siberian city's air the most polluted on Earth.Fourteen years ago, Ludmilla Proskuryakova came to Norilsk for a marriage. The husband is history, but she stays for the people.Sulfur dioxide pollution accounts for Norilsk's ever-present haze -- and scrawny trees.The port city of Dudinka receives the metals that are smelted in Norilsk, 50 miles away.