While he lived, Lucio Flavio Vilar Lirio was Brazil's most flamboyant criminal. Fond of poetry and painting, "the green-eyed bandit," as he was popularly known, was murdered in his cell in 1975 after publicly threatening to tell all he knew about the activities of the feared "death squad."

Now, however, Lucio Flavio has come back to haunt the death squads, the police-led vigilante gangs that execute petty criminals in Brazilian cities. A thinly fictionalized movie account of his life, called "Lucio Flavio: The Passenger of Agony," is breaking local box office records, sparking public indignation and encouraging investigations into alleged death squad corruption and links to the underworld.

Since their formation over a decade ago, Brazil's death squads have claimed credit for nearly 3,000 "executions." In recent years, according to charges made by a Sao Paulo district attorney named Helio Bicudo, they have operated with support from "the highest levels" of Brazil's military government because of their efficiency and their success in hunting down alleged subversives and leftist guerillas.

Until recently, the death squad and its leaders were high on the list of topics whose discussion was forbidden by Brazilian censors. But "Lucio Flavio" has broken the taboo by vividly and violently bringing to life the memoirs that Vilar Lirio, an admitted murderer and bank robber. dictated to a Rio crime reporter shortly before his death.

"Cops and robbers are the same thing, they're two sides of the same coin." one of the corrupt death squad leaders tells Lucio Flavio early in the film. "That's why we've got to be friends." In other scenes, death squad members are shown organizing a bank robbery, supplying machines and pistols to criminals and torturing and sexually assaulting prisoners.

"Lucio Flavio' is a denunciation of a particular social evil, of a form of repression that has existed in this country for nealry 20 years," said Hector Babenco, the film's director and screenwriter. "If they won't allow us to show reality on a life-size scale, then it's our duty to show it however we can, even if that means we have to reduce it to the size of a strip of film."

The audacity with which Babenco has treated this still -sentisitive topic has helped "Lucio Flavio" surpass imported films like "Jaws" and "Star Wars" to become the biggest box office attraction in Brazilian movie history. It has also provoked an extraordinary public discussion and debate that has penetrated virtually every corner of Brazialian society.

When "Lucio Flavio" was shown at a special screening in Brasilia for high government officials> the wives of several Cabinet ministers were reported to have broken down in tears. In Rio and Sao Paulo, police have sometimes been stationed outside theaters to keep order among audiences that emerge from the movie enraged and unruly, and to apprehend robbers hoping to pick up pointers frm Lucio Flavio's experience.

The movies release comes at a time when concern over police violence here is mounting. Although torture of political prisoners has diminished, observers such as Bar Association President Raymoundo Faoro and Sao Paulo's Cardinal Paulo Evaristo Arns have recently charged that police violence against ordinary citizens is on the rise.

Reaction to the film has perhaps been strongest among the urban middle class, the chief victims of a rising crime rate. Many of them have been content until now to let the death sqauad deal with criminals as it pleased.

"I used to look upon the death squad favorably", said a Rio accountant, whose comments have been echoed in letters to newspaper editors and TV street interviews. "But after seeing 'Olucio Flavio', I am complelely against the death squad and everything it stands for".

To get his message to the public, director Babenco was forced to make several compromises with Brazil's rigorous censors. Although government censors permitted Bebenco to use the real names of criminals involved in the Lucio Flavio case, they forced him to change those of police officers and forbid any scenes in which the corrupt police officials were shown in uniform or driving official cars.

All told, about 18 minutes were trimmed from the film before it was shown. In addition, censors demanded that the movie end with a legend announcing that "all the official elements involved in the Lucio Flavio case were expelled from the police and punished criminally" - a claim that some lawyers and legal officials here say privately is untrue.

But to other observers, the fact that "Lucio Flavio" was able to survive the censorship gauntlet at all is significant.

"Two or three years ago, any film that dealt so realistically with a social problem would have been vetoed completely and immedeately,"said a Rio film critic. "Lucio Flavio" is a real breakthrough, and it shows the times are changing."

One sign of the film's impact is that newspapers and magazines in Brazil are now devoting more attention to charges of police malfeasance and corruption.

At the same time, Sergio Paranhos Fleury, allegedly the head of the deat squad's Sao Paulo division, is being tried in a glare of publicity for the murder 10 years ago of a small-time offender. The chief target of prosecutor Bicudo, Fleury has been indicted a total of 22 times for alleged death squad executions.

In previous trails, Fleury, who in 1969 engineered the ambush and slaying of the government's leading political enemy, underground Communist guerrila leader Carlos Marig hela, has been acquitted. But Brazilian newspapers are urging thatr Fleury be prosecuted with more energy this time.