The Bakalis family has owned the Gold Rush nightclub since 1965 -- "before all this sex," says Anne Bakalis, who owns the club in partnership with her husband, brother-in-law and sister-in-law. Sometimes they wish they could take the street back to the time when, she recalls, the nightclub was surrounded by first-rate entertainment that drew a well-dressed, free-spending crowd.

Now the nightclub, at 821 14th St. NW, sits in the heart of the District's downtown prno zone and advertises its topless, bottomless cowgirls as assiduously as any other show spot on the short strip.

Surrounded on either side by stores and clubs sporting blown-up photos of buxom sex kittens, the Gold Rush is also in the midst of an area that can now be considered a prime opportunity for developers. Property values along the block have jumped from $60 to $80 a square foot in the past two years, and property just around the corner at 14th and H streets was auctioned for $530 a square foot in October, a record for a downtown property.

So while the Bakalises -- Silver Spring residents, but among the few business people on their 14th Street block who own their property -- say they aren't interested in moving, planning experts are certain that they will be tempted eventually. When that happens, the scramble will begin for a new home, perhaps not for them, but almost certainly for their neighbors along the sex-trade strip.

"It won't be long before the price of land runs them right out of there," said a source familiar with city planning but unwilling to have his name linked with that particular area of downtown development.

"That kind of activity depends upon making a quick buck at a short-term turnover. And once the economics pushes them off 14th Street, they're going to be very hard-put to find another honky-tonk zone. There aren't going to be very many places in the District they can go to."

At least one knowledgeable zoning lawyer thinks the sex trade will remain downtown wherever its business interests can find a perch.

"That area has a long tradition of bars and restaurants," said Kirk White, a zoning lawyer with Linowes & Blocher. "That kind of activity is probably going to continue. I think it will disperse downtown."

But many more sources in the know say otherwise. Municipal laws and high prices are bringing down the curtain on downtown porn, they say. Although most city officials asked not to be quoted on their predictions, citing relations with their suburban counterparts, many say privately that the only likely place for porno business to go is out of the city, into Maryland or Virginia, which have widely varying attitudes toward the business and property values that have yet to match those of downtown.

"I don't think it's going to be downtown," said one D.C. government development official. "We see that whole area as important for development; you have the Metro, two attractive parks, you have New York Avenue going to the convention center. It will go to suburban locations, shopping centers."

To prevent this, Northern Virginia has declared war on all types of sexually oriented businesses, seeking to crack down on massage parlors in particular and to prevent new business from coming in. Alexandria Commonwealth Attorney John Kloch said, "We have very little sex-oriented business down here, and it has been my personal endeavor to rid the city of it altogether. And I will certainly do my best to see that they don't get dispersed over here."

To that end, Alexandria views adult businesses as "amusement enterprises" whose permits require City Council approval, according to the Alexandria zoning office, and the city has stringent restrictions governing massage parlors' activities. The city makes periodic sweeps of the parlors to check compliance, Kloch said. Arlington and Fairfax laws are very similar. "I think you will find," said Kloch, "that Northern Virginia is united in keeping that business out."

Montgomery and Prince George's activists have already begun to fight the adult bookstores in the Silver Spring-Takoma Park areas, which have increased from one to three in the last 13 months.

"I think they're breaking up these things in the District and they're looking for somewhere else to go," said Leslie Agro, a Silver Spring activist with Neighborhoods Together Inc., a citizens group. "I hate to be judgmental, but they're beginning to attract seamy people, the kind you see on 14th Street."

Since 1975, Prince George's County has imposed zoning restrictions on adult entertainment areas, prohibiting them from locating within 1,000 feet of each other. The laws also require sexually oriented adult entertainment stores to gain special exception permits, which require public hearings before they can be granted. Until last year, bookstores seeking to escape the adults-only label could carry only 25 percent of their stock in sex-oriented material, but may now carry only 5 percent without requiring the hearing process.

The first bookstore in Montgomery County popped up several years ago in Silver Spring. "We weren't terribly concerned, we regard ourselves as a liberal community -- but it's gotten to be much worse than that," she added. Her organization has begun to urge the Montgomery County Council to pass a law to prevent the bookstores from adding live sex shows, which became an added attraction at a Silver Spring store in September.

Montgomery County has the least stringent restrictions on the sale and distribution of pornographic materials of any of the surrounding jurisdictions. A September 1980 bill to prohibit "obscene" live perfromances was introduced by County Council member Rose Crenca of Silver Spring, but was tabled by the council in January. Some council members said they felt the bill was too broad, possibly infringing upon the freedom of "legitimate" artists. Crenca says she will reintroduce the bill, but council President Rose Specter opposes the measure.

The stores that have sparked particular community distress in the last year are two in Silver Spring within two blocks of each other, at 8231 Georgia Ave. and 952 Sligo Ave. Both are owned by Suburban News Inc., which also owns the Takoma Park bookstore at 6854 New Hampshire Ave.

According to Montgomery County police and citizens groups, those stores belong to Dennis E. Pryba, a former D.C. pornography kingpin who once owned a handful of stores along 14th Street and one in Georgetown. Pryba, who did not return a reporter's calls to his Silver Spring stores, appears to be connected with two other stores in Prince George's County, according to information from employes at each site.

His Silver Spring establishments bear little resemblance to the gaudy neon glitter of 14th Street; on both stores the windows are opaque and covered with black wire, and large signs warn minors to keep their distance. But residents of the Silver Spring and Takoma Park areas say they dislike the stores less for what they look like than for what they are near and whom they might attract.

The Sligo Avenue bookstore is across the street from Gifford's Ice Cream store, a longtime favorite with area children, at 8101 Georgia Ave. The Georgia Avenue store is a door away from a beauty school and across the street from a music store that provides lessons to youngsters.

"I'd rip out that bird, run 'em out and put (the owner) behind bars," said John Leonard, manager of the Gifford's. "It'd cheapen any neighborhood. They say Silver Spring's like that anyway, and then you got clientele drifting in that aren't worth a 2-cent piece."

"We are dealing with kids who are from 16 on, and it's right there.

There are a lot of degenerates hanging around there, you don't know what's going on," said Chris Blish, director of the Robert Lewis Studio of Hair Concepts, at 8227 Georgia Ave. "And you know what worries me," added Blish, echoing the attitude of other Silver Spring business owners who are sensitive about the reputation the bookstore might bestow upon them: "Somebody called me the other day and said, "Where are you on Georgia? Are you near the dirty bookstore?' What a landmark!"

Residents and business owners agree that they stopped ignoring the bookstores when owners installed the theater to the rear of the Georgia Avenue store. Nude or seminude women "perform on the stage, which is surrounded by booths. Those who wish to view the women deposit several quarters and a curtain rises to permit them to see the women for a few minutes. The store also has another type of booth, where for a small fee a man can sit separated by a partition from a topless woman. What transpires inside these "One on One" booths is unclear.

"What's obscene about that," joked County Council member "is the price." But what most worries the residents is the prospect of their neighborhood's harboring another 14th Street. And that, say community leaders, they have vowed to fight.

"I don't know if we can get rid of the ones we have here," added Agro, "But this sort of thing can grow rapidly in a community; it's important to take quick action on this. I think we're being tested by the investors in this thing. But they're going to find out that we're a family community, and we don't want that here."