Phyllis Lilly paid $22 a week for the small room she rented on the fourth floor of the New Sherwood Hotel in Baltimore, which was gutted by fire yesterday. In her room were nearly all her worldly possessions: some clothing, a typewriter, eyeglasses, a few dollar bills, even her false teeth.

"I lost everything I had in the fire," Lilly said yesterday, as she stood across from the smoldering rubble of the blaze in which three people died and at least 17 others were injured. The only things she managed to save were the hair curlers, nightgown, and housecoat she was wearing when the fire broke out.

Lilly said she was awakened at 6:45 a.m. by the sound of the hotel fire alarm. Because there was no fire escape outside her window, she rushed down the stairs. On the second floor of the hotel she saw "a lot of smoke," while on the first floor she said she "could see the reflection of the flames. I could see the redness."

A few minutes after she had escaped to the sidewalk, "it was like someone took a fan (to the flames) because the smoke and the flames came out through the lobby and the windows," she said. She said she could hear the sounds of windows being broken by the raging flames and heat.

"Every room was a death trap," said Ray Rubin, who couldn't escape from his first floor room because of the smoke and flames in the hallway. Rubin was unable to climb out his window because of an air conditioner bolted in place, and was rescued by firemen outside the building who used axes to free him, he said.

Raymond Gannon, 24, pounded on the window air conditioner in his first floor room until he had smashed it open. "I bet you I hit that window 15 times in a minute," he said. After breaking the window and pushing the air conditioner out he jumped eight feet to the ground, he said. Left behind were two leather coats and three suits he had purchased Friday night. Gannon, an industrial painter, required 31 stitches on his right hand, according to a Red Cross official.

Paul Sirgheney, 45, another first floor resident, used a hockey stick in his $42 per week room to break open the window and then started "hollering" for help. Because the hotel is on a hillside, he said he was afraid to jump. He was rescued by firemen who had to pry loose a metal screen that protected the window before he could squeeze throught the opening, he said. Lost in the fire were a TV set, radio, sporting goods, and clothing, he said.

"There's one and a half years of work in those ashes," said Sirgheney, a clerk in a nearby adult book store.

William Gray, 35, raced up and down the hallway, knocking on the doors of other tenants to rouse them. "I could have ended up that way," he said of the three people who died.

Some survivors were taken first to the Greyhound Bus terminal, several blocks away, where they were placed inside an empty bus and questioned by officials investigating the possibility of arson. Others were taken to the Maryland Square Restaurant, where they were given coffee and food. Raymond Gannon gave a shirt to Paul Sirgheney to wear because, "I hate to see anyone without you know. I gave my other shirt to a man because he had nothing," he said.

At 1 p.m. yesterday, as she stood on the sidewalk in her housecoat talking to a reporter, Phyllis illy was suddenly embraced by her weeping adopted daughter, Dorothy Johnson, who, until that moment when she spotted Lilly, had not known if she was alive or dead.