Dorothea Lane Cutts II, 38, the prominent Alexandria business woman whose body was found by firemen in the basement of her Old Town town house early Saturday, died of smoke inhalation, an autopsy has determined.

Police said that Cutts' body was discovered bound with pieces of wire and clothing, gagged and lying on its stomach in a pool of blood. "She was definitely alive before the fires were set," said Sgt. Archie Hall, who added that the time of death was 5 a.m. - about 30 minutes before firemen arrived.

Police said there was no sign of forced entry at the town house at 125 Wolfe St. and that nothing was known to be was missing from the home. A burglar alarm system in the house had been turned off, they said, and both front and back doors had been locked.

There was no sign of sexual assault or struggle, police added, though there were abrasions on her forehead. Police said she was fully clothed when found and that there were no burns on the body.

"We have no motive and no suspect," said Sgt. Hall. "We're baffled."

Cutt's next-door neighbor Catherine Eldridge, said yesterday that she smelled smoke coming Cutts' 128-year-old house and awakened her son Paul, 21, at about 5 a.m. Saturday. Outside they were met by another man, Mark Walhauser, who was staying across the street and who was packing his car for a weekend trip to the beach, Paul Eldridge said yesterday. The two men ran to the back of the house, climbed a balcony and entered Cutts' second-floor bedroom through a partially open French door.

"The TV set was on, and there was a light," Eldridge recalled. "The bed was unmade." The two men tried going down the steps but were met by flames shooting out of the second floor, bathroom. According to fire officials, three fires had been set in the house.

Most of the damage, which police have estimated at $20,000, was concentrated on the second floor.

"We knew she had to be in there," Eldridge said. Wallhauser then opened the front door with a house key that Cutts had given to Mrs. Eldridge. The two men crawled into the living room on their knees, but were unable to find Cutts. When they emerged, Eldridge said, they were met by fire trucks responding to Mrs. Eldridge's alarm.

Alexandria police searched the house yesterday looking for clues. The smell of smoke was still strong.

According to Stg. Hall, the Alexandria police already have interviewed "about 50 friends, neighbors and acquaintances" of the dead woman.

Police said yesterday they also are planning to interview a former boyfriend and sometime business associate of Cutts who filed a lawsuit against her last year in Alexandria Circuit Court in a dispute over money.

According to the suit, the man had borrowed heavily from Cutts while the two were romantically involved. When she demanded payment, he filed suit disputing the amount. Cutts filed a countercomplaint and the case was settled out of court.

'The whole thing has left everybody confused," said Kathy Shepherdson, who accompanied CUtts to a suburban restaurant on the evening before the slaying. "We can't imagine anybody she knows being so brutal."

Catherine Eldridge said Cutts had just finished the painstaking restoration of her home, and had been invited to participate in the annual Alexandria House Tour this fall. "That house was a jewel," she said.