Shortly after democracy was restored here two years ago, a school for young film directors set up shop in the eight-story, baroque stone building where the censor's bureau had been under military rule.

Though the school stayed in those gray, government-issue offices only a few months before shifting into more modern downtown quarters, it accomplished its task. "It was a symbolic act to burn the witches," explained Manuel Antin, director of Argentina's National Institute for Cinematography, who ordered the move.

The lifting of censorship and the recent international success of such post-junta films as "The Official Story" and "Camila" have triggered a filmmaking boom here that its practitioners are likening to the golden era a half-century ago when Argentina dominated Latin American moviemaking.

"It's like after a wholesome rain, when the mushrooms come up," says Maria Luisa Bemberg, among the most prominent of the new Argentine directors. "There's a great necessity now to tell all the stories we're capable of."

Having fallen close to dormant during the bleak military period, Argentine film laboratories are now jammed with activity. Movie proposals are piling up at the National Institute for Cinematography, a major source of funding. Foreign producers have come to discuss joint production possibilities, and foreign distributors are phoning for rights to the latest Argentine films.

In fact, Argentina's film industry is just the most dramatic part of a cultural resurgence that has touched all the arts. Hundreds of writers, dramatists and musicians who were banned, exiled, jailed or censored by the successive military juntas that governed from 1976 to 1983 have returned or reemerged under democracy.

Many of their latest works are directed toward exposing past horrors or confronting surviving nightmares. Drawn from the dark years of repression and imposed silence are themes of departure and exile, of torture, murder and kidnaping.

On the screen, this has resulted in such productions as "The Official Story," about a woman who discovers that her adopted child belonged to a leftist activist murdered by the military; "The Exile of Gardel," about Argentine artists living in Paris as political exiles during the military regime; "Night of the Pencils" (currently in production), about a true incident in which 14 teen-agers were tortured to death; and "Kiss of the Spider Woman" (made in Brazil but written and directed by native Argentines), about political struggle, psychological defenses and friendship, set in a jail cell.

The trauma of military rule has given Argentine moviemakers a wealth of material and the authority of firsthand experience to treat issues of resistance, collaboration and conscience. But the movie industry here does not want to be typecast as the maker simply of political films.

Argentine productions are already addressing other issues, drawing on this country's rich immigrant history, for instance, or exploring religious and social dilemmas in such films as "Camila," about a forbidden love betweeen a young girl and a priest; "Overdose" (now in production), about drug use; "Poor Butterfly" (in production), about Nazis in Argentina in the 1940s; and "Miss Mary" (in production), about English colonialism, centered on the story of an English governess who comes to Argentina to care for a family.

"I don't think the film industry here is obsessed with conscience films," says film institute chief Antin. "The idea is to develop an industry that will reflect itself and the country."

Back in the 1930s and 1940s, then-prosperous Buenos Aires was a kind of Hollywood South, churning out 40 to 50 films a year, which were featured throughout Latin America. Then came Juan Peron, the populist military leader who imposed his stamp on motion pictures as he did on everything else in Argentina. His domineering influence and that of his wife Evita robbed filmmaking here of much of its freedom and creativity, resulting in the blacklisting of some artists and a drop in the quality of movies.

A new generation of filmmakers in the 1960s led to a flicker of a renaissance. But state financial assistance in those days was largely reserved for those productions that pleased a board of military appointees, and without government funds, other film ideas rarely got past the scriptwriting stage. "It was a corrupt process," says Alejandro Sessa, an Argentine producer. "It was easier to make a film that the jury would vote for rather than one people would see."

Military censorship had been institutionalized with the creation in 1968 of an office that avoided the word "censor" in its name. It was called Ente de Calificacio'n, meaning Board of Classification.

"With censorship our themes were absurd and were of no interest to other countries," says Sessa, whose grandfather founded Argentina's first film laboratory. "Because of a total lack of freedom, it was impossible not to shoot scripts that were escapist. No one got divorced, everyone lived happily with their families.

"When there was a political statement, it was all in symbols and parables in films like 'Time for Revenge,' about a worker who feigned muteness to avoid testifying against his company, or 'The Grandmother,' about a woman who ate and ate until her poor family decided to kill her. Even with these films, we couldn't get into the best-known international festivals, because no one believed that with military rule we could make anything creative."

Prohibited were not just certain political references but anything that violated the military's sensibilities. In the movie "Nobody's Wife," for instance, director Bemberg had to cut a scene of a nude male. "They got upset," she says of the censors. "Nude women were okay but not nude men. It was a very macho thing. They were adamant about it.

"Had I not had a censor looking over my shoulder," she adds, "my first two films ["Moments," "Nobody's Wife"] would have been different, they would have been much freer."

Bemberg began making "Camila" on Dec. 12, 1983, the Monday after Raul Alfonsin was sworn in as Argentina's first civilian president in nearly eight years. During the shooting of the film, after a particularly explicit love scene, Bemberg recalls instructing an assistant to record a milder version of the same episode for a separate copy of the movie, which, she was thinking, would have to be made for screening in Argentina.

Then Bemberg remembered. The censor was gone. And she broke into laughter.

The international acclaim lavished on "The Official Story" -- it won an Oscar for Best Foreign Film in April, capping a string of other awards in Cannes, Toronto, New York, Chicago, Havana and Quito -- has given Argentine filmmakers an important psychological boost and new marketing possibilities. "It has been a big key to opening the way for Argentine film in the world, for recognition of the recovery of the industry here," says Antin, himself a movie director.

Antin's appointment as head of the national film institute was made by Alfonsin. The director is the first movie industry member to lead the institute since 1976. As such, he is symptomatic of an important change in the management of Argentine arts generally -- namely, the return of the administration of art to artists. Today, nearly all the officials who oversee the government's burgeoning arts program are artists who were themselves victims of the military regime.

Though fearful that Argentine filmmakers may now become obsessed with winning more prizes, Antin himself has been especially active in promoting Argentine films abroad. He has had the institute open a branch called Argencine in Madrid to assist in European distribution.

"There is a danger that the patriotic rejoicing about the award of the Oscar will overshadow the implications of this film for Argentina as a society, which still has some way to go before it exorcizes its old demons," fretted the Buenos Aires Herald in a recent editorial. " 'The Official Story' is significant not just because it has won several major film awards, but because it represents one of the few serious artistic attempts to confront Argentina with the 'process' and describe why so many 'ordinary' people took the attitudes they did."

As this comment suggests, a reinvigorated film industry is important to Argentina not just as a source of national pride but also as a vehicle for self-reflection and understanding. But this is a delicate matter in a country where many are still wrestling with the past.

Release of "The Official Story," for instance, was delayed five months from its initial opening date of October 1984 because Luis Puenzo, the movie's cowriter and director, had doubts about how it would be received here. "I felt many were not ready to accept our point of view," explains Puenzo. "People were very saturated with information in the press about this theme."

After watching "The Official Story" play several weeks to medium-sized crowds, its Argentine distributor was ready to shelve it. But Puenzo persuaded him to wait two more weeks until the Cannes festival last May. There, Norma Aleandro won Best Actress for her starring role as the mother, and the movie went on to complete a 19-week first run in Argentina last year, attracting more than 1 million people. The film reopened in Buenos Aires this March and has been playing to packed houses.

The main damper now on development of Argentine movies is a shortage of funds. The National Institute for Cinematography, the major source of financial credit for most local productions, gets its money largely from its 10 percent share of movie ticket sales.

"A local producer has little access to loans," says producer Sessa. "It's not like in the United States where you can go to a bank, show a script and get a completion bond. If you go to a bank here with a movie script, they'll laugh at you."

The institute turns down many more requests for funding than it approves. It helped finance 31 films in 1984 and 48 last year, but rejected more than 250 other scripts. Even so, some critics say the institute is spreading its limited budget too thin and should lend more money to a smaller pool of productions.

To raise funds, some Argentine producers have had to look abroad. A New York-based investment firm, Progress Communications, contributed $125,000 to the $500,000 production cost of "The Official Story."

Coproductions, once used by Argentine filmmakers as a way to circumvent censorship and assure at least a foreign market for a locally conceived movie, are now a financial necessity. "In my opinion, if you can't beat them, join them," says Sessa, an owner of the Argentine production firm Aries Cinematografia, which has done seven action-adventure films with a U.S. partner.

"Because resources here are sometimes missing, you have delays in productions," says British actress Julie Christie, who has just finished filming here in Bemberg's "Miss Mary."

"There's a lot of technical improvisation. In the United States or Europe, for instance, if you have a scene to do in a car, you'd have the right camera and car. Here, they haven't always got the right equipment, so they spend hours trying to rig the wrong camera to absorb the car ride."

Christie said in a phone interview that she had been impressed with the ingenuity of the Argentine crew in making "Miss Mary" and with the "political sophistication" of the local actors and actresses with whom she worked.

*Short of money but long on enthusiasm, those involved in the revival of Argentine films are counting on an old moviemaking tradition and a reservoir of cinema talent to sustain the boom in the near term. "If we can make four or five good movies a year in the next few years, perhaps we can build a new cinematography," says director Puenzo. "It's not easy. But we do have good technicians and actors -- and we have many themes to talk about."

Says Sessa: "The film industry is a real luxury Argentina now has. It's an industry this country normally couldn't afford. But it is putting Argentina in the right place in the world."