EAST HARLEM, N.Y. -- The corner of 110th Street and Fifth Avenue offers disparate views of beauty and bleakness.

The beautiful is the vista of Central Park, its elms, birches and becalmed lakes forming the northern border at 110th Street and running south on 5th Avenue past the apartments of the wealthy for whom Harlem is the Third World. On a Sunday every late October, athletes in the New York City marathon pass by, this corner being near the 21-mile mark when the legs and mind are going numb.

Turn another way and the scenery is of abandoned buildings, shells of stripped cars and sidewalks where addicts sell and buy crack. All urban blights are here: homelessness, drug abuse, unemployment, crime and a high school dropout rate of 75 percent.

It's at this corner, though, that East Harlem, a community of Hispanics and blacks, has been transforming itself from despair to hope. The force is the Youth Action Program, a success story that for 10 years has combined self-help and self-confidence into projects that have included renovating gutted buildings, literacy classes, job training and youth centers. More than 5,000 of what are called ''society's most difficult youngsters'' have come to the program. In a departure from other social-service agencies, YAP asks the East Harlem youth how they want to shape their futures. Three-fourths of the board of directors are teen-agers. The staff is hired by a committee of young people.

In 1984, after five years of carpentry, painting and other rehabilitative work by 250 East Harlem teen-agers, the program restored a four-story brick building for housing young adults. Three more buildings, with 39 units, are now being renovated. In 10 years, more than 700 youths have been employed in permanent or summer jobs. It was a local school -- P.S. 121 -- in which the ''I Have a Dream'' project began, when Eugene Lang, a New York businessman, promised scholarships to all graduates who went on to college. YAP provided the six-year follow-up contact and support for the students.

The program's headquarters, a low-slung building with a colorful mural on the north wall located at 1280 Fifth Ave., attracts politicians and foundation officials wanting to connect with against-the-odds success. Mayors and city council members from some 40 cities have been here, as have the governor of New York, Jesse Jackson -- who slept overnight -- and the board of trustees of the Ford Foundation. Funds have come from federal, state, city and private sources.

Politically, the debate about teen-agers and their problems is usually focused on schools and families. YAP demonstrates that a third influence is needed. Schools and families often aren't enough, especially underfunded urban schools unable to provide attention to students on the margin and families weakened by unemployment or divorce. Community-based organizations connecting with teen-agers lost to their schools and families are essential. A difference can be made by something as simple, or as human, as getting to know the kids by name.

At YAP, the person familiar with the names, all of them, is Dorothy Stoneman, the founder and director. When the media wonder where the activists of the '60s went, they should look up Stoneman. Forty-five, a civil rights worker after graduating from Radcliffe-Harvard in 1963, she is a former public school teacher who is part Jane Addams, Margaret Mead and Saul Alinsky. Her current operating budget is $1.5 million.

When asked why she does this kind of work, Stoneman, sitting in an office graced with a picture of Gandhi holding a child, reflects for a moment: ''I find this enjoyable. The level of intelligence of the young people, which has been unrecognized, is exciting. It's really fun to work with them as they begin to take action and think through problems. There's always a liberation of energy here. It's never boring. They have good ideas, and it's always close to the reality of what needs changing in society.''

Stoneman's social virtue is her teacher's ability to bring out the good in others. She runs YAP with, not for, the East Harlem kids. ''Any program,'' she has written, ''which is to work in liberating the positive energies of young people must respect them enough to put power and responsibility into their hands. It must consciously contradict the unfortunately widespread mode of working with youth as if they were merely people who needed to be 'gotten off the street.' ''

William Treanor, the director of the American Youth Work Center, a Washington advocacy group, praises Stoneman not only for being inspirational with the kids in East Harlem but also with stretching dollars: ''She can put businessmen to shame in efficiently running an operation.''

It's well that she does. Increasingly in the future, it will be her kind of program that does the work of reaching the kids that we call unreachable.