IN THE late 1980s, open-air drug markets came to symbolize the brazen presence of criminals who believed they could hawk their illegal wares with impunity. These enterprises in the Washington area set the worst of examples for neighborhood children and demoralized adults. Some 91 open-air markets existed in the District. There were 25 in Prince George's County, nine in Montgomery and eight in Fairfax County.

Over the past year, stepped-up police efforts have driven some markets out of business and have severely curtailed activity at others. Citizens in several Washington-area neighborhoods also deserve credit. In the District, for example, residents have formed some 90 community patrols that work with police and report drug activity.

Apparently this is not a situation in which the dealers have simply been forced to seek other equally public locations to sell drugs. D.C. narcotics officials report that half of the city's 91 open-air markets either are less active or have gone out of business. Only nine such markets now exist in Prince George's. Prince William County's open-air sales have been reduced by 50 percent. The same can be said for Alexandria and for Montgomery and Fairfax counties. Drug sales in Arlington's worst drug market have all but ceased.

But the decline in open-air markets, while welcome, is not a sign that the drug problem has been eradicated or that violent crime is being brought under control. In some cases drug activity has been driven underground. In the District, more dealers are using threats, drugs and money to gain access to apartments and homes, small businesses and restaurants, where they can sell drugs unobserved. That makes police disruption of drug activity more difficult. It also puts a new burden on the vigilance of individual citizens.

As one way to meet the problem, the D.C. Council is considering legislation to let the city revoke operating licenses of businesses that "knowingly permit" drug activity. But shortcuts such as this are not the right answer. The slow building of a case that can lead to search and arrest warrants is the better way to proceed. Hard-pressed as they are, citizens must become even readier to report suspicious activities. This can help to produce a true decline in illegal drug activity.