At least three persons were killed and 29 injured yesterday morning when a spectacular nine-alarm fire raced through a four-story brick hotel and an adjoining apartment house near the heart of downtown Baltimore.

Flames leaped through the windows of the New Sherwood Hotel on West Monument Street and rose above the roof as the blaze raged out of control for three hours.

The three dead were identified as Joseph Rosen, 77, a retired furniture finisher; George Miller, 45, a merchant seaman; and Margaret Pennington, 64, who lived in Scottsdale, Ariz.

Rosen, who had lived in the hotel for 10 or 15 years, was found in his fourth floor room. Pennington was found in her room on the same floor, and Miller, who had a first-floor room, was found in the lobby.

Of the injured, 17 were reported to be residents of the two buildings. Twelve fire fighters were treated for minor injuries at various hospitals and were later released.

Several residents of the 71-unit hotel escaped by jumping from windows as smoke and flames curled around them.

Witnesses in the neighborhood three blocks west of Baltimore's Washington Monument watched breathlessly as Clarence Narvell, 31, dangled for desperate moments from a fourth-floor window ledge, then dropped to safety on the canopy over the hotel entrance.

The blaze, which brought about 200 fire fighters to the scene after it was reported about 7 a.m., was called "the largest hotel fire I can remember in recent times" by Baltimore Mayor William Donald Schaefer.

The cause of the blaze was not immediately known, and was still under investigation last night.

Deputy Fire Chief Herbert Catterton said the fire apparently bwgan in a first-floor laundry room that contains washers and electric dryers.

He said there were indications that the fire had smoldered through the night before bursting into flame shortly before 7 a.m.

It spread through the four stories of the hotel before reaching the roof, which subsequently collapsed, Catterton said.

The fire also spread to the second and third floors of the three-story brick apartment building tht adjoins the hotel. The apartment house has a separate entrance and could also be entered from the hotel.

United Press International quoted an unnamed fire official as saying that the blaze spread so rapidly because of the open construction - the open hallways and the open rooms and the open stairwells."

Interviewed at the scene about 1 p.m., Mayor Schaefer described the hotel as being adequately maintained, and said he saw no apparent violations of fire regulations.

Philip Needle, a Baltimore investor who is one of the owners of the building, said in an interview that "it couldn't remain open unless it passed inspection. . .

"Any time we get a recommendation it's taken care of immediately," he said.

Several persons, who said they were residents of the hotel, expressed dissatisfaction, however, with what they asserted was the inadequacy of emergency exits and of provisions made to warn them about the fire.

One of them, Raymond Gannon, 24, a painter, who had been at the hotel for about a month, described his first-floor corner room as a "very hard room to get out of."

To escape, he said, he had to push an air conditioner out of the window, break open a window with repeated blows of his bare hand; and then jumped about eight feet to safety. He received 31 stitches to one hand, a hospital official said.

Two men who lived in the adjoining apartment house helped some of the hotel residents to safety across their building's lower roof before fire forced them to retreat, according to an Associated Press report.

"I kept telling the people on the back of the building to come next door across the roof but some of them were too scared," one man was quoted as saying.

The hotel, about eight blocks north of Baltimore's redeveloped Charles Center, was described by Mayor Schaefer as being in one of the older parts of the city.

Needle, who said he has been an owner of the hotel for about 10 years, estimated room charges at about $17.50 for single rooms and $21.50 for doubles.

He said he was unable last night to make an estimate of the damage or to recall the price paid for the hotel.

Officials said the Red Cross, Salvation Army, and the city's housing and community development department were coordinating efforts to find housing for those displaced by the fire. Some of those who escaped waited for three hours in a bus at the nearby Greyhound station before accommodations were found.

According to Needle, the occupants for the hotel included both transients and many permanent residents.

After fleeing to safety yesterday, some of the residents congratulated themselves on their escapes, and recalled items they had lost among things they listed were a $100 bill in one man's wallet, and a woman's false teeth, spectacles, typewriter and clothing.

Firemen continued through the day yesterday to sift through the debris of the rooms and hallways, looking for bidies of those who have not yet been accounted for.

For part of the day, neighbors could hear the sounds of the Preakness Day parade, a few blocks away, which had been diverted from its planned route to avoid the fire scene.