James Oland Harvey, 78, a retired chief with the Montgomery County Department of Transportation who was active in community affairs, died of emphysema Thursday at the Manor Care Nursing Home in Wheaton. He lived in Olney.

Mr. Harvey was a native of Brookeville, Md., and a graduate of the old Brookeville High School.

He joined the county transportation department in 1935. He was chief of the highway maintenance and equipment division for over 20 years before he retired in 1967.

Mr. Harvey was a member of the County Engineers Association of Maryland, the American Roadbuilders Association and the Maryland Association of Highway Engineers.

From 1957 until 1970, he was president of the Montgomery County Fair Association that runs the county's annual fair and other shows at the county fairgrounds in Gaithersburg. He was a past president of the Olney Chamber of Commerce and was named its Outstanding Member for 1980. He was the Montgomery County Chamber of Commerce Outstanding Member for 1973. He also belonged to St. John's Episcopal Church in Olney, the Sandy Spring Lions Club and the Sandy Spring Fire Department.

His wife, Carolyn Howard Harvey, died in 1961.

Survivors include a brother, C. Willard Harvey of Brookeville.

The family suggests that expressions of sympathy be in the form of contributions to the Salvation Army.