In this cramped grocery store, the air grows close when Dottie Leonard walks in. Glen Davis, the store's co-owner, has nothing to say to her; he grumbles and marches out. The clerk and a customer in a red shirt eye her suspiciously. Leonard is, to them, a symbol of the forces out to change Haymarket.

The fight this day is over a neon sign that Davis wants and that members of the Town Council, including Leonard, won't allow. There have been other arguments in Haymarket, population 850--over a proposed shopping center, over the purchase of real estate, over "historic" building guidelines. But there's more here than small-town quibbles on a hot day.

"I'm from the old school," says the woman in red, Barbara Fauver, whose shirt reads "Sheetz" from the gas station down the road where she works. "I think you ought to just leave it alone." By it, she means everything.

"Haymarket would have withered and died if we didn't come in," counters Leonard, a 29-year resident. By we, she means folks like her--those who see Haymarket as the next Middleburg, quaint and historical.

In this half-mile-square town in western Prince William County, which is 200 years old this year, the big fight is over the future. Haymarket is about to be surrounded by more than 7,000 upscale homes, and that fact--nothing can alter it--has split town residents. There are those who want to seize the opportunity to redevelop the town and those who want to gird Haymarket's borders against change in an effort to save the town they know.

A thousand other small towns have weathered the same storm. Some towns remain in name only. Others have managed to maintain a sense of self. Like Haymarket, they have asked themselves whether change can stop at a town's borders, and if not, whether they should welcome it in.

One of the last towns in Northern Virginia to be relatively untouched by development, Haymarket has long known that its time was coming. Five years ago, after citizen opposition in Prince William defeated Disney's attempt to establish a U.S. history theme park north of Haymarket, the town imposed Colonial-style restrictions on how buildings within its borders can look.

Since then, the Town Council has narrowed those restrictions, nabbed money to fix its crumbling sidewalks and install benches and street lamps, and is under contract to buy a block of the main drag, Washington Street, to renovate and expand its town hall--and rent out a portion of the building to retail. All the fixes are just about to begin.

If the Town Council has its way, the people buying homes in four massive housing developments right outside its borders--Dominion Golf and Country Club, Piedmont, Heritage Hunt and Greenhill Crossing--will feed Haymarket's revitalization by visiting new speciality shops, street cafes and an ice cream parlor. With private enterprise and a strict government, Haymarket will be historic, in the style of Old Town Alexandria, Leesburg and Ellicott City.

"This will make the town beautiful and maintain our identity as a town, and not be part of the suburban sprawl," Mayor John R. Kapp says.

But others aren't sold. Some business owners bridle at the regulations dictating how their properties should look, considering the approach a heavy-handed attempt to cater to the newcomers on the outskirts of town.

"There's a lot of nitpicking rules," says lifelong resident Charles King Jr., 48, who staunchly opposes altering the way things have been done in Haymarket. "This is America. If my neighbor leaves me alone, then I'm not gonna bother my neighbor."

And the council's attempts to clean up the town--especially its purchase of one downtown block--have led to accusations that it is spending too much money and taking on too much. The town has a contract to buy the block for $1.25 million. The mayor says that leases on several properties will cover that cost. The town has received several grants to help cover the costs of improvements to Washington Street.

The people coming into the developments will have just the kind of spending power needed to support a town of antiques shops and boutiques, gift stores and elegant restaurants. The new homes around Haymarket will sell for upwards of $200,000 and top out at more than $1 million. That's in a county where houses averaged $135,600 in value last year.

Western Prince William--with its new, gated communities, at least five golf clubs built or planned, and proximity to high-technology hubs such as the growing Dulles Corridor--is beginning to draw a more affluent population to the county.

As more people make the trek westward from Washington's inner suburbs, some residents of Haymarket fear they'll increasingly feel like an island in the midst of sprawl. In the past three years, Greenhill Crossing, which hugs Haymarket's eastern end and sits partly on town property, has built the first of its 1,300 homes. The impact of that building has nearly doubled the town's population.

That single development has given residents a taste of things to come and imbued some with a siege mentality. "It's a small town," says King, of Haymarket. "It's gonna grow up around us regardless of what we do. . . . But [inside the town], I say zero growth. This is the only part that we can control."

It has also lead to a feeling that Haymarket is becoming stratified, that the old residents are pitted against the new. And people who have lived in the town for a long time feel put upon by those who seem to have no sentimental investment in the history of the town.

"You've got a lot of new people in who are ruling the roost," says Fauver, 58. "The people that are coming in, they have their say."

But when the newbies visit Haymarket--not often, despite their proximity to it--many see little there to care about.

"Basically, all those buildings are shot. I mean, they're old and crumpity," says Dianne Brady, whose family was the sixth to move into Greenhill Crossing and who drives about 10 miles into Manassas to buy most of her necessities.

In Haymarket now: three beauty shops, a TV/VCR repair shop in a small shack, one restaurant, one town hall built in 1883, one antiques shop in an old post office, one used-car outlet, which has no cars on its property.

The council's goal is to make Haymarket a destination. Yet in a town where many families have lived for decades or generations, changing their older, slower way of life means forgoing precious freedoms. In the case of Haymarket Grocery, the town's only grocery store, Davis wants to put up a neon sign so folks driving by will notice it. There's already an old, unlit sign there, from decades back, bearing the store's previous name.

But the town's new historical guidelines don't allow a new one. Neon signs are not the "old town" look that Haymarket is going for.

"Be yourself. Don't try to be a downtown D.C. or a downtown Manassas," says Davis, who runs the grocery with his son. "They're trying to play big government."

Inside Haymarket Grocery, the cashier and the customer in red want to know why Dottie Leonard and the rest of the Town Council seem to be caving in. They want to know why Haymarket can't stay stubborn against a shifting world.

Now, "you've got to have permission to do this. You've got to have permission to do that," complains Fauver, who has lived one mile outside the town limits for 35 years.

"I've seen many changes all over the area," says Helen Facemyer, the cashier, whose grandmother lived in Haymarket. "I've seen every little town go from little bitty town to great big monstrosity."

Leonard fears the same thing. But if Haymarket does not adapt, she says, it has no hope at all.

As she puts it later, "Haymarket needs to be well-preserved in order to survive."

Outside the store, Leonard picks her way across the cracked concrete and gravel that is her town's sidewalks. Come this fall, the town will use federal funds to start building the brick sidewalks it wants to create a "strolling atmosphere."

Leonard's optimism belies a desperation. She's seen other communities crumble when they didn't pull together in time, and get crushed by the weight of growth. But she is exhausted from the argument, exhausted by this crusade.

"I'm trying to preserve Haymarket," she says, "but the fight's slowly going out of me."

CAPTION: When citizen opposition defeated Disney's attempt to establish a U.S. history theme park north of Haymarket five years ago, the town imposed Colonial-style restrictions on how buildings can look. Now some residents want to reconsider.

CAPTION: Catherine Ainsley, 84, and her husband, Arthur, 86, rock on their front porch. Although its population has recently doubled, Haymarket was one of the last towns in Northern Virginia to be touched by development.