The highly flammable, totally uncleanable, carpeted and upholstered interiors of Metro's famous 615 AM General buses will be replaced, the Metro board of directors decreed yesterday. It had become essential.

"I have a secretary who is devoted to public transportation." said a montgomery County official. She rides the bus every day. But if an AM General bus comes by, she waits for the next one. They are just too dirty-looking to ride."

The board yesterday approved a tiny portion of its capital budget so the bus improvement program can get underway. It will cost about $3,000 a bus to do the job and 166 buses will be done the first year. It is the latest in a long series of corrections that have been made to the AM General fleet.

There were four major problems with the AM General buses when they were first delivered to Metro in 1974:

The air conditioning didn't work. Through mechanical trickery, the heating system would come on in the middle of an August rush hour and override the air conditioning. Passengers complained.

The destination signs on the inside of the bus had the disconcerting habit of falling down and hitting people seated below them on the head. Passengers complained.

The diesel fuel tanks leaked. Passengers and Metro maintenance crews complained.

The buses developed structural defects including cracks in the rear wheel wells and separations of the bus body from the frame. Everybody complained.

But AM General fixed all those things as part of the original $23.3 million contract it received to provide the buses.

"We maligned AM General and rightfully so." said Nicholas Roll, Metro's assistant general manager for transit services, "But they responded, and the AM General buses now run as well or better than any other buses we have.

"The interiors were our decision, and we have to correct it." Hard-to-clean fabrics were chosen for the seats, carpets were put on the floor and upholstery was installed along the side and top. It was all part of Metro's attempt to improve the image of bus service in Washington in the months immediately following the public takeover of four private bus companies here.

But those classy fabrics proved to have many problems, not the least of which was that they caught fire easily. five of the new buses burned and a 13-year-old boy died in one of the fires. He had been asleep on the back seat of the bus. Arson was suspected.

The National Bureau of Standards conducted tests and discovered that the Metro bus cushions were highly flammable. Metro's maintenance crews simply could not keep the seats clean-looking because of stains.

The bus refurbishing program approved by the board yesterday includes new flooring. side panels and headliners, and vinyl covered seats that will clean easily.

The board deferred action for another week on its operating budget for fiscal 1979. Negotiations on financing the budget, which center around fare adjustments, are continuing among members of the board.