About 100 people who live near Children's Hospital in Northwest Washington gathered last night to listen to a partnership make its case for developing a 25-acre parcel, a plan that has sparked controversy between residents and would-be builders.

Officials of the McMillan Limited Partnership outlined plans for a $188 million project that would feature 436 residential units, a recreation center administered by the YMCA, outdoor tennis and basketball courts, a shopping center, a 24-hour child-care center and a church.

The group -- one of whose members is Kossow/Clark Limited Partnership, an affiliate of the African Methodist Episcopal Church -- said the project would provide 1,900 construction jobs and 1,500 permanent jobs.

The meeting was sponsored by Advisory Neighborhood Commission 5C04, which is to vote tonight on whether to endorse the proposal or a competing one from a group called McMillan Partners, led by the Horning Brothers development firm.

The McMillan Partners plan would include 255 residential units, office space and commercial properties, including a Giant Food store. No one from that partnership attended last night's meeting.

The site is bounded by Michigan Avenue, Channing, First and North Capitol streets, and includes the McMillan Reservoir.

The land was bought by the District for $9.2 million in September 1987 from the federal government, which stipulated that the city could not sell it for profit for at least three years.

Last summer, a group of residents who want 12 acres of the land set aside for a park filed suit in an attempt to stop the city's plans for commercial development.

Several residents at last night's meeting questioned James R. Murphy, an attorney for the McMillan Limited Partnership, about potential traffic and parking problems. Several said they were not prepared to support either developer.

"I think they're putting too many people in there," said Lisbon Berry, an architectural engineer who lives in the area. "If you put in 400 residential units and a shopping complex, it's going to {exacerbate} the traffic and parking problems."

Murphy defended the plan. "We worked over 2 1/2 years to come up with this design," he said. "We think we have the best proposal."