In the steamy night air outside the Casbah nightclub, a half-dozen youths huddled excitedly over a sidewalk game of craps. Down on the corner, as neon lights flickered overhead, a group of older men in tattered cotton clothes shared a pint of whiskey.

It was Saturday night on U Street NW.

"It didn't used to be so bad around here," mused Mamie Smith as she sat at a table inside the Casbah, at 1211 U St. NW, listening to the live jazz and watching the dancing. "In the old days me and mygirlfriends would bar hop all overU Street.But that was a long time ago, honey, way before you were born."

From the late 1920s to the late 1940s, U Street Northwest was the jazz and nightclub heart of Washington. In places like Jimy McPhail's, Rocky's and the Lincoln Colonnade, all between 10th and 14th streets, stars such as Hary Belafonte. Charlie Parker and Pearl Bailey used to boogie and swing the nights away to the delight of loyal, enthusiastic crowds of blacks and whites.

By the early 1950s, though, the jazz and blues thoroughfare began to lose its reputation as a mecca for black entertainment , primarily because nightclubs began to lose their popularity to more convenient forms of entertainment at home, such as television and increasingly sophisticated stereo recording system.

U Street business and culture declined to a point where, since the mid-60s, it has been known as a haven for abandoned rowhouses, cut-rate carryouts, parking lots, drug addicts and the attendant crime, the poor and dispossessed.

Now Amon Cockingham, owner of the Casbah, wants to change all that. "I want to make this place like a lot of supper clubs around here used to be like," he said. "Jazz at night, good soul food and dancing, dancing, dancing."

Sandwiched between Ben's Chili Bowl and Top Job Painting, the Casbah seems an odd place to recapture U Street's vibrant past. The club is simply a long, narrow room with 15 tables lining each side wall, a bar at the entrance and bandstand at the rear.

Yet music lovers, sidestepping the crap games and corner whiskey parties, are going to the club on weekends because, in the words of 52-year-old jazz vocalist Mary Jefferson, "People'll go through anything to hear good, down-to-earth jazz."

Jefferson, a big, jovial woman with a rich, hearty voice, sings with the club's jazz ensemble, the Spontaneous Jazz Quartet, which includes her husband, Mark Hill, on drums; Teaberry Johnson on guitar, Ross Tyler on piano, and Nap Turner on bass. Jefferson and the quartet have performed in area churches and clubs for more than 30 years.

"Everybody can't be a star, but we sure do twinkle," she said before sipping a bear and looking over the crowd of 25, which included nearly a dozen whites, who had come to hear the music, pad the $3 admission price and sat drinking and talking loudly.

"It's a shame to see this section of the city die. If we're lucky the street'll dance and people from all over town - from places like Georgetown and Chevy Chase - will come back and dance with us again.

"It's as simple as this. If there's something to hear or do in the ghetto, whites'll come. That's for sure."

As several couples danced, Jefferson sang "This Time," "On the Street Where You Live" and a Billie Holiday melody.

"Blues ain't nothing but a woman wanting another woman's man," went the lyric of one song, and Jefferson chuckled when a woman sitting in the rear exclaimed, "I'll drink to that, baby."

Mary Burns, a statistician for the D.C. Department of Human Resources, heard about the Casbah from a friend. "I like live music that's fun and isn't exorbitantly expensive," she said. "That's the main reason I'm here."

Warren Morse, a writer who lives in far Northwest Washington, said he hopes the nightclub succeeds and stimulates a jazz revival in the area.

"I hope it all comes back," he said "because I love jazz and blues.The thing is, we have to make the streets livable again. I'm white, but I know a lot of black people who couldn't dare come U Street on a Saturday night.

"Maybe I'm crazy. My own son was murdered in the street. I just feel, though, that if the people get control of the streets, everything'll be just great again."

For many of the younger blacks in the audience, the club's live entertainment was a new experience.

"I've never been to an old fashioned supper club," said 25-year-old Diane Hewit, of Silver Spring, who scrutinized the menu that included chitterlings, fried chicken and barbecued spare ribs. "I really like this. It's different, you know?"

For the older listeners, it was the past reborn.

"Damn. I love those old songs," said William Lango, a 50-year-old head waiter at the Chevy Chase Country Club, as he performed an impressive jig on the linoleum floor. "She sounds like Ethel Waters, doesn't she?"

At the end of the first set, drummer Mark Hill swallowed a small glass of bourbon as an all-white blues band called Harry's Harpoon House Records took the stage.

"The black entertainment circuit," said Hill, who has played in countless black bands in his professional career, primarily with Lionel Hampton, "used to be like this. The Royal in Baltimore, the Howard Theater in Washington, the Regal in Chicago, the Paradise in Detroit and the Apollo in New York. Most of 'em are gone now, and the young folks don't know nothing about how it used to be. They go to discos nowadays, which amounts to dancing to records. Shoot, they don't know what fun is.

"If I had my way, a lot of good musicians in town would be out playing live every night instead of spending their time looking for work that's unrelated to their true craft."

Casbah's manager, Elaine Adams, remained optimistic.

"We don't have the money to advertise or anything like that," she said. "As a matter of fact we just started with the live jazz only a few weeks ago. But we think support generates support. Everybody you see here found out about the place by word of mouth. We hope it'll grow even more in time."