Zirl S. Smith, handpicked five months ago by Mayor Marion Barry to help improve the District's deteriorating and deficit-plagued public housing projects, resigned abruptly yesterday from his job as deputy public housing director.

Smith, 34, said he decided to leave his $42,098-a-year job because of "philosophical differences" with public housing administrator Sidney Glee "about the changes that were required for the organization." His resignation was to take effect immediately.

Glee confirmed that the two men disagreed on how the administration should be run, but added, "Zirl and I are not mad at each other."

Barry, who announced the selection of Glee and Smith at a September press conference, had no comment on Smith's resignation yesterday.

According to sources familiar with Smith's decision to leave, he resigned after Glee blocked a series of management changes Smith wanted to make to improve the low staff morale at the administration, which is regarded as a backwater at the Department of Housing and Community Development.

High-ranking city officials explained last fall that Smith had been brought in to be "the inside man." He was to manage the public housing apparatus of 430 maintenance men, social workers, armed security guards and secretaries--with a $36.6 million budget and nearly 12,000 apartments and homes--because Glee had little management experience.

Glee, who was a middle-level employe of the city's health and welfare department until his friend from college, housing director Robert L. Moore, made him acting public housing administrator more than two years ago, was to be "the outside man" who would talk to the tenants.

But that system broke down, according to sources, because it made Glee uncomfortable.

The sources said that when Smith tried to improve staff morale by proposing a comprehensive management training program, a project to help staff members with their careers and promotions, these were blocked by Glee.

When Smith went to Moore for support, Moore sided with Glee, according to sources. But Moore said yesterday that this was not true, saying, "I don't pick sides" and "I tried to help them work together." But he added, "I back my administrators to the hilt."

Neither Glee nor Smith would comment on their differences. "Anything that had to be done had to be done together," Glee said. He added that managers often disagree but "people usually give in." He said that "adjustments" were made for Smith, "but the adjustments were not made to his Smith's satisfaction."

In addition, Smith found that long-range improvements had to take a back seat to immediate problems such as poor rent collection, a large deficit and the need to respond to complaints of no heat, no hot water, and housing code violations.

Moore said Smith left because "we have a different kind of management style. We are much more community-oriented, and his style is more administrative and in the office. We expect all of us to be out and be known by the residents."

Moore also said that he thought Smith might have been frustrated by the bureaucracy he found in the D.C. government. Previously, Smith had worked for the public housing authority in Toledo, Ohio, which was independent of city government, but in Washington, public housing is a branch of the housing department, and therefore many decisions are ultimately made by the mayor or the housing director.