Washington's waterfront is a relatively well-kept secret, if you ask Rick Morgan, who earns his living on the banks of the Potomac River and wishes that more people would discover its beauty.

"This river is a good place to work, a good place to be. It's a beautiful atmosphere, but a lot of people don't know about it. We got to get some new people here," said Morgan, 34, whose late father, Morris, moved Morgan's Seafood to the Maine Avenue SW waterfront 12 years ago from its landlocked site on Georgia Avenue.

Tens of thousands of landlubbers got the chance to appreciate the water yesterday on the second and final day of Riverfest '85, the second annual extravaganza initiated by D.C. Mayor Marion Barry to celebrate the progress in cleaning up the Potomac River from its previously perilous level of pollution.

D.C. police estimated that more than 100,000 people jammed into the festival area that included the Maine Avenue wharf and East Potomac Park (Hains Point). Free boat rides, live music, air-sea rescue demonstrations, tours of the tall ships and a late-night fireworks show drew a steady stream of visitors and vendors to the Southwest waterfront.

The festival location along Washington Channel is the most convenient but decidedly not the cleanest spot to celebrate clean water, as some visitors remarked, while watching beer cans, paper cups, cigarette butts, an occasional old tire and other assorted flotsam bobbing in the brackish water.

"Let's just say the river is a lot more beautiful upstream," said Ruth Howes, a visiting scholar at the Arms Control and Disarmament Agency. "This is not its best spot."

Even if the mighty river is more scenic upstream, the Potomac channel yesterday was an impressive showplace of nautical activity, from the one-person kayaks and graceful Albacore sailboats to the giant two-story paddleboats, the majestic tall ships and the fire rescue boats that spewed 10-story columns of water with high-powered hoses, creating a rainbow in the hazy sunshine.

It was the visit of Capt. Jacques Cousteau and his sleek research vessel, The Calypso, along with the tall ships, that drew the biggest crowds. Many visitors climbed aboard the 133-foot Lightship Chesapeake, a sturdy 1930-vintage ship that is now a floating museum but which once was permanently anchored in Chesapeake Bay to guide ships in the era before bay lighthouses. Only the giant ships drew longer lines than the cold beer, spiced shrimp and barbecue.

"We're from Oklahoma and Indiana, and you just don't get too many big ships out there," said Robert Howes of Falls Church, a dental researcher at the National Institutes of Health. "The tall ships are just beautiful and they give you a feel of the glory of the past," he said, while waiting to tour the Alexandria, a handsome Baltic trading schooner, and getting a look at two replicas of Viking longships.

The Potomac once teemed with life, but it became an environmental disaster area by the 1960s, at about the same time that urban renewal was ripping up the old Southwest waterfront. A $600 million, 15-year antipollution effort under the Clean Water Act, coupled with the multimillion-dollar Southwest redevelopment, have changed the scene, both on water and land. Pleasure boats and waterfront shops and restaurants have again spawned here, and some species of fish have returned -- although the seafood sold at shops such as Morgan's is all from the Atlantic or the Chesapeake, not the Potomac.

Vendors' booths also teemed with life, though little of it related to the Potomac. Aside from the traditional varieties of food, jewelry and clothing, there were vendors selling AT&T's services, memberships in Army National Guard and the Veterans of Foreign Wars, D.C. Lottery tickets, Blac Fax trivia games, hair braiding and pamphlets of "positive poetry for particular people."

Many visitors such as teen-ager Leon Gates of Northwest admired the hundreds of cabin cruisers, trawlers and houseboats moored at the Capitol Yacht Club. Gates watched the owners sunbathing and washing their boats. "They look pretty nice," he said, but added he was not sure about the comfort of living on water. " . . . It's like people who live in house trailers, only they are floating around, and you might get seasick."