Ivy Oneita Duce, 86, a former Washington resident and the Murshida, or spiritual guide, of Sufism Reoriented, a religious organization, died of acute anemia Wednesday at her home in Orinda, Calif.

Mrs. Duce, who was born in Jersey City, N.J., and reared in Tampa, Fla., went to France with the American Red Cross during World War I. After the war, she was a bank representative in South America. While in Colombia, she met James Terry Duce, a geologist with Texaco, and they were married in 1923.

The couple were living in New York when the United States entered World War II. In 1942, they moved to Washington when Mr. Duce became director of the foreign division of the Petroleum Administration. After the war, he was head of government relations for the Arabian-American Oil Company (ARAMCO). The Duces remained here until about 1958, when they moved to California.

Mrs. Duce became interested in Sufism as a result of the suffering she observed during the war. A basic principle of the Sufi tradition, a mystical branch of Islam which originated in Persia, is that humans are reincarnated many times and thereby learn about God and the world, including suffering.

Mrs. Duce was appointed Murshida of the Sufi Order in 1947. After studying with the Avatar Meher Baba in India, she restructured Sufism and renamed it Sufism Reoriented. Even after moving to California, she maintained a Sufi residence and center in Washington. She had about 400 students, 65 of them from the Washington area.

Her husband died in 1965.

Survivors include a daughter, Charmian Knowles of Walnut Creek, Calif., and three grandchildren.