Five hundred to 1,000 children and adults, many of them physically handicapped, marched from the White House to the District Building and the Capitol yesterday to protest what they say are shrinking social services for the disabled brought on by Congress and the Reagan administration.

Some hobbled on crutches; others rolled in wheelchairs down Pennsylvania Avenue NW, part of a Disabled Americans Freedom Rally that started three weeks ago from Berkeley, Calif., to bring their discontent to Washington.

They met D.C. Mayor Marion Barry and other local political leaders in front of the District Building, and some went on to the Capitol to see congressional leaders. Their message: conversion of specialized federal grants into state block grants may jeopardize education, training and housing programs for the handicapped.

"We are not just 'the disabled,' we have names and we have faces," Donna Wilke, 27, this year's Miss Wheelchair D.C., told the crowd at the District Building. Later she said, "There is no decent transportation in the D.C. area." She added that the most important issues for the handicapped in the area are housing, access to public buildings and financial security (many must depend on welfare checks).

Wilke added that low-cost government loans to convert houses and apartments to accommodate crippled people have been frozen and that in the District of Columbia, there is a two- to three-year waiting list for special housing for the handicapped. "Unfortunately," she said, "we have to compete with the elderly for housing."

Too many communities are resisting establishment of group homes for the retarded and mentally ill, contended march coordinator Yetta Galiber, director of the District's Information Center for Handicapped Individuals. She said she sees this as narrow-mindedness on the part of healthy people who are only "temporarily able bodied."

Eva Britt, 36, a recent Howard Law School graduate who has had crippling arthritis since childhood and must maneuver on crutches, said, "Disabled persons are out here to stay . . . My greatest and strongest goal is support of vocational rehabilitation." She said she is afraid that if such programs are incorporated into state block grants, "The federal government wipes its hands of responsibility."

Federal funds enabled Mwenea Ajanaku, 26, a D.C. native, who is severely crippled, to equip a van to accommodate his wheelchair. He said he has driven across the country five times and treasures his independence.