Poverty in the United States declined significantly during the first half of this decade, and the fast-growing South showed the greatest improvement, new Census Bureau reports show.

However, the 11.6 percent drop in the number of poor people in the nation between 1970 and 1975 was far short of the 39 percent reduction that occurred in the booming 1960s.

The slowdown resulted from the generally stagnant economy in the early 1970s, said Carol Fendler, a census statistician specializing in poverty figures. "We were in and out of recessions with heavy unemployment and high-level inflation caused by the oil embargo," she said.

Poverty declined 16 percent in the South, slightly more than 10 percent in the Northeast and Northcentral regions, and 13 percent in the West between 1970 and 1975, the reports show.

The figures are contained in four regional reports, the latest of which (on the West) was published by the bureau yesterday.

The South's progress stems from the fact it has become more urban and industrial, Fendler said. But she noted that its poverty rate, 20.3 percent in 1970 and 15.3 percent in 1975, was still the highest of any region.

Larry H. Long, chief of the bureau's population analysis staff, said, "It's pretty clear that most of the decline in the number of poor people in the country has occurred in the South, which ironically has been the poorest region. The spurt in employment growth in the South has absorbed much of the low-income population" and put them above the poverty line.

In long-range terms, the national poverty decline seems dramatic. In 1960 there were 39,851,000 people below the poverty level-22 percent of the nation. In 1975 the figure was 23,991,000-11.4 percent. Each year, with inflation, the poverty level rises. It is now $6,190 for a nonfarm family of four.

Locally, the early 1970s saw sharp decreases in poverty. In the District the decline was more than 30 percent; in Virginia it was nearly 26 percent; in Maryland, 19 percent. In 1975, however, Washington's poverty rate was still 12.5 percent; in Virginia it was 10.5 percent and in Maryland it was 7.7 percent.

The bureau's report also show that the South was the only region where median family income, when adjusted for inflation, rose between 1970 and 1975. Income there increased 5 percent, while it dropped 1.8 percent in the West, 1.7 percent in the Northcentral states.

Long noted that the South's per-capita income was still below the national average but had climbed steadily since 1940, when it was only two-thirds of the U.S. average. He said it rose to 76 percent in 1950, 79 percent in 1960, 86 percent in 1970 and nearly 90 percent in 1975.

Daved A. Olsen, a Census Bureau statistician specializing in income figures, suggested that the income increase in the South results from "new technology and lower labor costs which attract business." Long added that "improved highways and other roads in the South mean that industry can draw workers from a wider area.

That, has been a big attraction for business."

By 1975 median family income in the South was $12,443. It was $15,085 in the Northeast, $14,813 in the Northcentral region and $14,739 in the West.

Locally, it dropped a little in Washington during the five-year period from $14,059 to $14,001, but went up in Virginia from $13,278 to $14,579 and in Maryland from $16,233 to $17,556.

Nationally, median family income went up only a few dollars - from $14,073 to $14,094.

The figures reflect the general sluggishness of the economy in the early 1970s compared with previous decade. For instance, the economy grew by only 11 percent between 1970 and 1975 after growing 26 percent in the first half of the 1960s and 16 percent in the second half.

The jobless rate, which fell below 4 percent in the 1960s, surged to 8.5 percent in 1975. And inflation, increasing at a benign rate under 2 percent a year in the early '60s and an average of 4.6 percent a year in the late '60s, rose at an 8 percent clip in the early 1970s.

The Census Bureau said "one of the most striking findings" in its four reports was the large increase in median income for persons living alone or with others not related to them. Higher Social Security payments accounted for most of the increase, the bureau said.

For unrelated persons, median income rose nationally rose 41.4 percent, from $3,654 to $5,168 in the early 1970s. In the South the increase was 59.6 percent. It was 47 percent in the Northcentral states, 32.6 percent in the Northeast and 32.1 percent in the West. Locally, the increase was nearly 20 percent inthe District, 71.5 percent in Virginia and 47.8 percent in Maryland.