As Loudoun County moves into the final decade of the century, the number of farms continues to grow despite an intensive growth in the number of new houses and businesses since the mid-1970s.

The number of farms in Loudoun increased from 837 in 1974 to 934 in 1987, according to the U.S. Census Bureau. Loudoun's population grew from 47,500 in 1970 to 86,000 in 1990, said Jean Brown, a research analyst with the University of Virginia's Center for Public Information.

Agriculture is one of the county's biggest industries; in 1988 the estimated sales value of agricultural products was $48.6 million, said Helene Lepkowski, an agricultural development officer with the Department of Economic Development.

Always a mainstay of Loudoun's agricultural base, the number of large farms growing traditional grains and grasses -- wheat, soybeans, corn, barley and hay -- declined by about 10 percent from 1982 to 1987. The number of small farms, those less than 50 acres, has increased nearly 200 percent since the mid-1970s.

With the breakup of large farms, the influx of newcomers and the rise in land prices in western Loudoun continuing unabated, farming practices are changing, county officials said.

"There are a number of new people who have moved into the county, professionals, retirees, who want to benefit from being in a rural environment but want to produce something on the land as well," said Lepkowski. By 2000, Loudoun County is expected to have 145,000 people, according to the Metropolitan Washington Council of Governments.

In their search for the higher profits needed to justify the higher cost of land, many small farmers are tapping into the specialized needs of Washington area residents.

Large farms have been divided into smaller tracts on which increasing numbers of nurseries, Christmas tree farms, commercial vineyards, farms specializing in honeys, herbal vinegars and jellies and those rearing exotic animals such as llamas and buffalo have sprung up, Lepkowski said.

In an effort to preserve open space, Loudoun County offers tax breaks to landowners who maintain active farms, which must produce at least $1,000 worth of agricultural produce a year.

Many people trying to escape the city who otherwise might not have gone into farming have taken advantage of the county program, said Gary Hornbaker, of the county Extension Service.

Businesses that rely on agriculture -- those that sell fertilizer, feed and farm machinery -- have managed to accommodate the needs of small farms by scaling down their products.

"Quite honestly, if it wasn't for the new farms many of these businesses would have failed," Hornbaker said.

Horse farming, always a major contributor to Loudoun's economic base, continues to prosper.

Horse farms are eligible for the tax break only if their owners raise horses for breeding, racing or show purposes.

Despite the loss of tax revenue, Hornbaker said that the horse farms have "a major impact on the local economy." Horse farms tend not to be self-sufficient, Hornbaker said. "They usually buy their hay, their grain, their straw, they hire people to build fences. So I think that's been a good subsistence to farmers in business here who have those kinds of products to sell. It's been a good match."