Federal Judge Julius J. Hoffman, the sharp-tongued jurist who ordered Black Panther Bobby Seale bound and gagged during one of the stormiest cases of the Vietnam era, the "Chicago Seven" conspiracy trial, died yesterday at Northwestern Memorial Hospital. He was 87.

Police said Judge Hoffman was found at his home here and taken to the hospital. The cause of death was not reported.

Judge Hoffman was on the bench for 35 years--five years as a Cook County judge and 30 years as a member of the U.S. District Court for the Northern District of Illinois. Federal judges are appointed for life. But a year ago, Judge Hoffman effectively was retired against his will when an executive committee of the court system declared that cases no longer would be assigned to him.

The judge asserted that he retained his mental alertness and that his experience would be useful to the court. His secretary said he continued to report to his office every day and on Thursday had performed a naturalization ceremony for more than 100 new U.S. citizens.

A diminutive, dapper man, Judge Hoffman tried hundreds of cases, but none captured as much attention as the trial of the Chicago Seven--Abbie Hoffman, Jerry Rubin, David Dellinger, Renny Davis, Tom Hayden, Lee Weiner and John Froines. The trial lasted six months in 1969 and 1970.

Five of defendants were convicted of conspiring to cross state lines to incite riots at the 1968 Democratic National Convention in Chicago. Weiner and Froines were acquitted. In overturning the convictions, a federal appeals court said that "the demeanor of the judge and the prosecutors would require reversal even if errors did not."

Judge Hoffman always defended his handling of the case, in which he imposed heavy contempt sentences after an endless stream of courtroom shouting matches.

"I just did what I perceived to be the right thing," he said in an interview last year.

He cited defense attorney William Kunstler for contempt 24 times and had Seale bound and gagged during a pre-trial hearing. Seale later was separated from the proceedings and never went to trial.

In one exchange during the trial, defense attorney Leonard Weinglass suggested to a witness they "explore" areas of disagreement.

Judge Hoffman responded: "No. We are not at the North Pole. We are not going exploring, Mr. Weinglass."

Kunstler once complained that the constant change in the length of sessions made it difficult to keep witnesses on hand.

Judge Hoffman responded: "Don't tell me how to run this court. When I have to call on somebody, I will try to get a qualified person."

During the trial, Judge Hoffman was reviled by some of the defendants as a "racist, fascist pig." Defendants Hoffman and Rubin once wore judicial robes to court, threw them down and stepped on them.

Even a dozen years later, Judge Hoffman had harsh words for Kunstler, Rubin and Hoffman. "They made a mockery of the highest trial court," he said.

Kunstler, who once called Judge Hoffman's court a "a medieval torture chamber," said yesterday in New York that the judge was a "very vain and authoritative man."

But he added: "I thought he was kind of a worthy opponent when I wasn't hating him. He was well read and literate." He had an ability to "respond with a witticism and some of them were funny. Not all of them."

Judge Hoffman presided over other controversial trials, including a lengthy Krebiozen cancer cure case and a desegregation order involving a Chicago suburb.

A native of Chicago, Judge Hoffman attended Northwestern University and was admitted to the Illinois bar in 1915. He practiced corporate law until 1947, when he was elected to the criminal bench in Cook County. In 1953, President Dwight D. Eisenhower named him to U.S. District Court.

Judge Hoffman's wife, Eleanor, whom he married in 1928, died in 1980. Survivors include a stepson and two granddaughters.