Leonel Castillo, the 38-year-old Chicano whom President Carter has nominated to head the Immigration and Naturalization Service, is a liberal Democrat and a veteran of the civil rights movement, the Peace Corps and activist Mexican-American politics.

As Houston's city controller, Castillo has been somewhat of a maverick. Among other things, he is a liberal hewing out a reputation as a fiscal conservative, a minority politician determined to succeed in the mainstream. Often outspokenly critical of the policies of former Mayor Louie Welch, a conservative, Castillo has been at odds less frequently with Welch's successor, moderate to liberal Mayor Fred Hofheinz. One of their public splits was Castillo's endorsement of collective bargaining for Houston's fire fighters.

Castillo functioned as "a team player," says one who worked with him for the Harris County Democrats, a liberal coalition including organized labor, blacks, browns and whites. That Democrat, national committee woman Billie Carr, predicts that as INS commissioner, Castillo "is not going to be a bomb thrower, but he not's going to be a yes man, either."

Castillo, who reportedly was unofficially offered the job in late February, would come to INS at a time when organized labor is increasingly protesting that jobs that could be held by Americans are being taken by aliens. Labor Secretary Ray Marshall has said that as many as 8 million aliens are illegally in the United States, roughly 80 per cent of them Mexicans. At the same time, Hispanic rights groups are stepping up their lobbying to win amnesty for aliens already in this country without proper permission.

Castillo in a recent interview, said he doubts that there are any easy solutions to these problems, and he doesn't expect to back any new laws or announce any dramatic policies until he gets better answers to some old questions. He said he wants to know how many aliens are in this country without proper documentation, what kinds of jobs they hold, and whether there are American citizens who want to fill those jobs.

He said he is particularly concerned about legislation to make it a crime for employers to knowingly hire illegal aliens because such sanctions could promote discrimination against Mexcian-Americans "or anybody else who looks foreign." But he says he might back civil penalties if civil liberty safeguards can be worked out.

Castillo echoes Attorney General Griffin B. Bell's reservations about a national identity card, but said he supports efforts to develop "an unforgeable Social Security card." LIke the Carter administration, Castillo supports amnesty with resident alien status for some undocumented aliens who have been in this country for a certain period of time, but he isn't sure how long.

Castillo favors stiffening security at the nation's borders with Mexico by concentrating more immigration personnel there and says he backs tougher sanctions against the "coyotes" who transport illegal aliens into the country.

However, he says INS needs to do its job more humanely. As commissioner, he says, he would visit detention camps for aliens being deported and might even "sleep in one or two of them."

Castillo is midway through his third two-year term as city controller. He has the largest political constituency of any Mexican-American in Texas, and has had an unconventional political career by the standards of this generally conservative city.

He rose to prominence in 1970 as leader of a well-organized and successful Chicano boycott of Houston's public schools, a last-minute action prptesting a federal court order that paired a number of schools with mainly black and Mexican-American enrollments and allowed schools in more affluent whit sections to escape the brunt of integration.

Castillo's anticipated nomination has drawn strong support from national Hispanic groups, with whom he has close ties, and from several Roman Catholic bishops. In Houston, the choice was well received across the political spectrum, with even Castillo's old nemesis, former Mayor Welch, calling him "an exceptionally good choice" because of his "humanity" and because "he delegates administrative functions very well."

Several Houston-area building trade unions opposed him because he opposes prosecuting employers of illegal aliens, but the head of the Texas AFLCIO, Harry Hubbard, has said that organization would not oppose him.

Castillo met last week with about a dozen immigration lawyers from across the country, and asked for their ideas as part of his preparation for the job and for Senate confirmation hearings. One who attended the meeting, Houston attorney Sam Williamson, said Castillo, didn't commit himself to any specific positions, very articulate man who has a lot of heart."

Castillo's personal style is relatively spartan although he and his wife and two children live in an upper middle-class, mostly black neighborhood near downtown Houston. Castillo said that until recently he bought many of his clothes at Goodwill and Salvation Army stores, and he drives a 1972 Toyota sedan. As Houston's elected city controller, Castillo earns a voter-set salary of $14,800 per year - less than half that of his chief deputy, a civil servant.