Orland Payne McCafferty, who set himself on fire in front of the White House Friday night, is a 58-year-old insurance underwriter whose frustrations over a year-long period of unemployment apparently drove him to make what he considered an ultimate statement about the country's economic policies.

It was a gruesome turn in a life that McCafferty's neighbors near Lee's Summit, Mo., had considered merely odd until yesterday, a life that had included degrees from the University of Missouri and Georgetown University and years as an officer in the Army Reserve.

Sometime last week McCafferty pulled his 1982 Toyota away from the dilapidated little house where he had grown up, left behind his 84-year-old mother dying of cancer and apparently drove more than 1,000 miles to Washington, intending to deliver to President Reagan a three-page letter complaining about unemployment and inadequate retirement benefits for servicemen. McCafferty ended the letter by saying that he hoped the horrible thing he planned to do might "light the way."

He left his missive in the Toyota where he parked it a block away from the White House. Sometime around 10 p.m., he apparently doused himself with flammable liquid, walked to the front gate of the presidential mansion and in clear view of a few passers-by turned himself into a human torch, with flames shooting up six feet and more.

Yesterday, President Reagan was, according to a White House spokesman, "concerned about the condition of the man" who lay in critical condition at Francis Scott Key Medical Center in Baltimore with second- and third-degree burns over 40 percent of his body.

McCafferty's ailing mother, Minnie McCafferty, when informed of the event by a reporter, choked back sobs and said, "I just can't imagine it. I didn't know he was that bad off. If he was going to Washington, I didn't know it."

His sister Wanda and her husband, busily arranging to fly to Washington from their home in Mission, Kan., said McCafferty had been depressed for months, but had given no clues about his plans.

Longtime neighbors were equally shocked, remembering the strange, quiet man who never seemed to have any visitors since he and his wife divorced some years ago, who generously paid the children who mowed his law but kept his drapes drawn, and who disappeared for days, sometimes giving no outward signs of life except for a light he kept burning in his attic.

Charles Rice has lived down East Todd George Road from the McCaffertys more than 40 years and watched Orland McCafferty grow up. Still, McCafferty remained an enigma, Rice said, very pleasant but a little like a character in an old cartoon.

"You remember in the funny papers the character, the timid soul?" Rice said. "He always reminded me of the timid soul. If you said, 'Squat!' he'd probably squat."

But, Rice said, the entire McCafferty family seemed quiet and standoffish and for years had lived in the tiny house that some regarded as an eyesore in an otherwise well-manicured middle-class neighborhood with spacious lots, near Prairie Lake.

According to Rice, McCafferty's father -- a machinist who worked for the Works Progress Administration during the Depression and then was employed as a trucker by the Remington Arms Co. -- and sister Wanda were the only members of the family who liked to mingle in the community.

McCafferty left home to study at the University of Missouri. From there, the bits and pieces of his life that have emerged show a man of intelligence who reached out for something more in life, but apparently kept slipping behind.

The man known to Army officials as Orland McCafferty was commissioned through the Reserved Officers Training Corps program at the University of Missouri in 1951, although an Army spokeswoman said yesterday she couldn't conclusively confirm with available records that it was the same Orland McCafferty who set fire to himself Friday.

McCafferty, who once kept his father's old war uniforms in a trunk that he left unattended in the yard, was inducted into the reserves and saw no action overseas. "He didn't serve in Korea or Vietnam," said Army spokeswoman Capt. Ginny Allen.

Allen said that the only record of active service in McCafferty's file was at Fort Sill, Okla., where McCafferty was enrolled in officer's training at the field artillery school.

McCafferty remained in the reserves for 28 years, until his retirement in 1979, and, according to his brother-in-law, he regularly flew around the country on reserve missions. The reserves seemed to have been one of the few positive aspects of his life as he approached middle age. Neighbors recall that McCafferty's mail frequently bore an Army return address.

Sometime in the mid-1950s, McCafferty set his sights east and moved to Washington, where he apparently enrolled in the Foreign Service School at Georgetown University. Records of the university's alumni association reflect that McCafferty graduated in 1957 with a bachelor of science degree in foreign service.

There was no immediate indication that McCafferty followed up on his studies at the foreign service school, which trains many of the nation's diplomats. Instead, McCafferty went into insurance and held jobs in Hartford, Conn., and New York.

After some years, McCafferty returned home, tired and disappointed. "He came back to Kansas City. He said he was tired of the rat race in New York, as any intelligent man would be," said McCafferty's brother-in-law, who declined to be identified.

In 1980, according to university alumni records, McCafferty was working at the national insurance firm of Crum & Forster in Kansas City.

But that seemed to be the beginning of a series of job failures, according to his brother-in-law. McCafferty moved from one firm to another in apparently rapid succession, sliding into a deepening depression.

His mother Minnie became ill and abandoned the family home on East Todd George Road. McCafferty, who was divorced after a brief marriage, moved in and attempted to restore what neighbors described as "a shack on a lake" into respectable living quarters: hacking away at the thick brush neighbors had complained about, painting, paneling and paying Rice's daughter and granddaughter to mow the lawn.

But for most of the surrounding community, McCafferty was no more outgoing than his shy and withdrawn mother. One neighbor, Richard Christl, said, "I always wondered if he lived somewhere else, too. I just saw him going to the mailbox, and that was about it."

About a year ago, McCafferty lost his last job and told Mildred Rice, the wife of Charles Rice, that he was "real concerned" about finding another.

Gwen Shoot, another resident and acquaintance of Minnie McCafferty, said, "I didn't even know he wasn't working. I just thought he was traveling. His car would be there at times. And then it would be gone."

McCafferty probably had no close friends at all, according to his brother-in-law and neighbors, and apparently never fully confided his growing distress and inner turmoil.

The Rices said McCafferty, whose intelligence and articulate conversation sometimes seemed to put him above his neighbors, was always friendly in his own quiet way when they saw him in his yard. He never talked about politics and in their conversations focused his concerns on his mother's health.

"I wouldn't say he was so depressed that he'd set himself on fire," said Charles Rice. "The fact is, he would never tell you very much personally about himself unless you asked him."

It was not the Orland McCafferty they knew who walked to the main White House gate on Pennsylvania Avenue Friday and set himself ablaze. As flames shot six feet into the air, two bystanders rushed to save him. A woman standing nearby threw a coat over his body. Jim Collier, 46, raced across to the scene and rolled himself over McCafferty.

D.C. homicide detectives yesterday refused to release the complete text of McCafferty's three-page letter. They said the letter was sealed, waiting to be picked up by the Secret Service.