It seemed an ordinary tea party: the ladies -- and a couple of men -- of the affluent Cleveland-Woodley Park neighborhood in Upper Northwest Washington gathering to welcome new neighbors yesterday afternoon.

But the five newcomers -- Pat, Verdell, Barbara, Thelma and Edith -- were all mentally retarded women. A casual observer would not have been able to distinguish them, in their summer dresses, from the other dozen or so guests, nor have known that they have lived an average of 20 years each in Forest Haven, the District government's home in Laurel for the retarded.

In a few days, the five, and later three others, will move into a house on Cathedral Avenue, bringing for the first time to this quiet residential area a small piece of the city's program of deinstitutionalizing the retarded.

Disclosure last week that the Cathedral Avenue home had been designated a halfway house for the retarded triggered a flurry of protest from some neighors, who complained they had been given inadequate notice by the city. They also contended the house was too small for eight adult residents and that the city is paying too much in rent.

But yesterday, after city officials had acted to smooth the ruffled feathers, artist Grace Spring welcomed them to the sculpture- and painting-filled dining room of her home near the new group home and to the table spread with homemade sugar cookies, banana bread, lemonade and iced tea.

"This is a tradition here in Cleveland Park," Spring said. "When new neighbors move in, we have an open house."

"It's just to indicate that there are some of us here in the neighborhood who did not have a negative feeling about the house," said Spring's husband, Bob Reinstein, a Department of Energy official.

Dr. Michael Perrone, director of the Kennedy Institute, which has a contract with the city to house the women, had shown the women their new home for the first time. The five, ranging in age from late 20s to early 60s, explored the newly painted pastel rooms that are still largely unfurnished, chose bedrooms and marveled at their new surroundings. Deinstitutionalized two years ago, the group has been living in a house at 13th and R streets NW, a tough, crime-ridden area considered inappropriate for their progress toward independent living.

Verdell -- all five were identified only by their first names at the request of the D.C. Department of Human Services -- spent much of her time at the party yesterday displaying mimeographed homework sheets covered with meticulously neat copying of her name, digits and alphabet.

At her sheltered workshop last week, Verdell, 36, demonstrated one of her proudest achievements. Gripping a pen fiercely, she painstakingly printed her name in neat letters. It took her a year to learn the task, a major step on her path to independent living, her counselors say.

During three years training at workshops operated for the District government by the D.C. Association for Retarded Citizens, Verdell has learned simple skills in food service training.

Equally important, she has acquired basic skills necessary to life outside the institution such as telling time and paying fares on public transportation.

"She's gotten a lot more independent. She even takes the initiative with other students who come in," added Karen Clay, Verdell's personal adjustment counselor.

Vincent Gray, executive director of the Association for Retarded Citizens, said many misconceptions about mentally retarded persons are caused by confusing them with the mentally ill and by an innacurate public image of them as severely or multiply handicapped. The majority of such persons are moderately or mildly retarded, Gray said..

The women who share Verdell's group home are all moderately retarded, with no secondary or complicating disabilities, according to Jan Eichhorn, director of the District's community services bureau, the agency responsible for relocating Forest Haven residents.

A federal judge ordered the city in 1978 to place some 900 Forest Haven residents in community-based homes and close down Forest Haven. About 740 persons are still there. In order to facilitate the opening of community homes, the D.C. Zoning Commission implemented new regulations last month allowing the homes in areas where they were previously prohibited.

Over the next three years, more than 180 such facilities will be needed for former Forest Haven residents.