Michael R. Olmstead, the Naval Academy midshipman convicted in the first court-martial at Annapolis in more than 50 years, has been given a second change at a career in the Navy.

The Academy announced yesterday that Olmstead, dismissed last March for a drunken driving accident in which another midshipman was killed, will be allowed to return to the Academy for the fall semester. At the end of the semester, Academy officials will review Olmstead's conduct and performance and decide if he will be allowed to graduate and be commissioned as an officer.

Olmstead was convicted of involuntary manslaughter March 9, a year after his sports car swerved off a road on Academy grounds and slammed into a tree, killing Scott D. Thomas, his close friend and roommate. s

After the accident, the alcohol level in Olmstead's blood measured 0.199 per cent -- almost twice what the government considers the threshold for intoxication.

Olmstead's court-martial -- the first since a 1922 hazing incident -- was seen by some midshipmen as an attempt by Vice Adm. William P. Lawrence to clean up the image of the Academy, which recently had been involved in a sex scandal resulting in the expulsion of three midshipmen.

"The country wants to look up to military officers as persons they can be proud of," Lawrence said in March to explain his decision to court-martial Olmstead.

Yesterday Lawrence took responsibility for Olmstead's second chance.

"In reviewing the record . . . as well as Midshipman Olmstead's entire record of performance and conduct at the Naval Academy, which was unblemished prior to this incident and which has been exemplary since it occurred, i concluded, notwithstanding the serious and tragic nature of this offense, Midshipman Olmstead has demonstrated a real potential to provide useful service to the Navy in the future," Lawrence said.

In a statement released yesterday, Olmstead thanked Lawrence for his "compassionate action," and warned other midshipmen about the dangers of alcohol abuse.

"I hope that others have learned from my ordeal that there is the opportunity for disaster daily in our lives," Olmstead said. "Particularly, I hope my case will increase public awareness of the tragedy involved in alcohol abuse."

Since he was dismissed from the Academy just three months shy of graduation, Olmstead has participated in the Navy's "Alcohol and Drug Education Program," a curriculum project designed to counsel and instruct midshipmen about the problems of drugs and alcohol in their personal and professional lives.

Following the conviction, the Academy allowed Olmstead to complete his required classwork at Annapolis pending the decision of a committee that automatically reviews all courts-martial. The committee will meet next week to consider Lawrence's action as well as the legality of the entire trial.

When Olmstead returns to Annapolis for the probation period this fall, "He will be a senior in every sense of the word except he won't have to take classes," Annapolis spokesman Dennis Boxx said. The only obstacle in the way of Olmstead's graduation is a "complete" grade in the area of conduct.

In his statement, Olmstead pledged to actively continue his work as an alchohol abuse counselor once he returns to campus following a short vacation. "I hope that my case and work in this program will help someone, particularly another midshipman, avoid the pain from a personal tragedy like mine," he added.

Boxx said that Olmstead's "involvement in the program came to bear on [Lawrence's] decision."

In another case involving a midshipman, Annapolis came under attack yesterday from a black senior dismissed from the Academy in June who charged he is a victim of racial discrimination.

The midshipman, Donell J. Green, said the Academy "engaged in a well-planned scheme of action to bring about his discharge" because of a fight Green had with his white roommate last February.

Academy spokesman have denied the charge, saying that Green's "overall unsatisfactory performance" led to his dismissal