As the first woman president of a prestigious American university, Hanna Holborn Gray is more concerned with fighting battles to uphold traditions at the University of Chicago than with setting more firsts.

When she became the 10th president of the University of Chicago just over a year ago, Gray took leadership of a university that, like most, faced the problems of inflation and reduced government funding, at a time when the goals of elite universities increasingly are being questioned.

Gray has been forced to spend much more time raising funds for the 86-year-old university than did her predecessors, such as education maverick Robert Hutchins or former attorney general Edward Levi. So far, however, she has not been forced to make major cutbacks, preferring to "find out what we do well and do it as well or even better with less."

But the university expects that its $309 million budget next year will include a $3.76 million deficit.

For Gray, 49, who estimates she spends close to one-third of her time raising money, the first year at Chicago was uneventful -- with one exception. r

That was the choice last May of Robert S. McNamara, former secretary of defense and now World Bank president, as the first recipient of the $25,000 Pick Award for International Understanding.

Although Gray did not participate in the selection, she received much criticism over the choice. A number of students and faculty opposed McNamara because of his role in the Vietnam war and because it is unusual for the University of Chicago to award major prizes for nonacademic achievement.

More than 1,500 of the university's 8,000 students held a 1960s-style protest on the day of the award ceremony and more than a third of the university's faculty, including 13 department heads, disassociated themselves from the selection of McNamara.

Gray reacted in a manner that may come to be her trademark. Insisting that the proper procedure had been followed in the selection. Gray refused to ask the faculty to overturn the choice of the faculty committee charged with picking the award winner. She announced that a long-term committee would be formed to consider the question of how all university awards are given.

Gray's handling of the McNamara controversy did not satisfy all the critics. Said Andrew Patner, editor of the student newspaper The Chicago Maroon: "There is no getting around the fact that it was a political award given for political reasons, and Gray showed insenstivity in not withdrawing the award or changing the nature of the award." i

"Politicization is something we have fought against for a long time," said anthropology professor Bernard Cohn.

Gray defends her decision to form a committee to study the issue of awards rather than reverse the McNamara choice. As she has with many issues -- the proper enrollment size of the college, finding new sources of financial support, and the relationship between the university and government -- Gray has chosen to set up faculty committees rather than announce her own views.

"It would be incompatible with the kind of institution this is to not have deliberative and rational discourse among the faculty on critical issues," Gray argues."These sorts of discussions are slower, but are ultimately more powerful."

Patner, however, says that Gray "is cautious to the point of being over-cautious on important matters of [educational] policy. She should take a look at her predecessors and see that they were educational innovators who made the university stand out."

One educational innovation of the Hutchins era that neither Gray nor the faculty question is the Common Core curriculum, which is studied by freshman and sophomores in the college. A rigorous and traditional liberal education, the core curriculum requires students to take a full year of classes in the social, physical and biological sciences and in the humanities. Among the sequence title are "Political Order and Change," "Literature-Philosophy-History," and "Human Being and Citizen."

The Chicago core program differs substantially from the sort of recently introduced liberal education curricula that are gaining widespread support.

"Harvard's program, the focal point for the revival of liberal education, is not based on a series of core courses in our sense," said Gray. "Their program is made of core requirements, but it is not core courses. Ours is entirely different than saying 'Western Civilization' is important, so the student can pick from 25 courses in the general field.

"Our core program serves two functions. Students are introduced to certain important intellectual methods and topics, and a common underpinning of intellectual experience is formed so that students learn together."

The core program, which evolved from the Great Books program developed at Chicago in the 1930s, continues to stress the classics in small classes run by the Socratic method.

"I think that it is very hard to graduate from this college not having read some Aristotle, some Plato, some Thucydides," said Gray. It has been true for a long time that you hear more students here debating what they are reading and doing in classes than anywhere else. You can actually hear them arguing what Aristole wrote and meant."

Although the Hyde Park campus is often viewed as a serious place, it does have its humor -- such as the football team. The fact that the team hasn't had a winning season since 1924 is a bit misleading, since football was outlawed by Hutchins in 1939 and not revived until 1969. The version of football now played at Chicago includes a marching kazoo band and a favorite cheer that begins "Themistocles, Thucydides, the Peloponnesian War, X-Squared, Y-Squared, H2SO4."

Football at Chicago was immortalized in a comedy routine by the Second City theatrical troupe in which a player corrects the coach by pointing out that it is the 50-yard line segment, while another mistakes left guard for Kierkegaard.

One of Gray's desires is that the 2,700-member college be a "more fun" place to be. "There is a stereotype of the college as a grim and drab place where people of high intellect study all the time," said Gray, who has supported efforts to renovate the school's arts and athletic facilities.

She is careful, however, not to offend those who take pride in the unique character of students at Chicago.

"I do not think administrators should be paternalistic -- or maternalistic -- about pushing people toward extracurricular activities," said Gray. "We should go on having our kind of fun, our idea of big-time football with 1,000 students in a kazoo band on Saturdays for their fun, with 2,000 students in the library for theirs."

Gray, who taught in Chicago's history department for 11 years, then joined the administrations at Northwestern and Yale before returning to Chicago, is familiar with the school's often contentious faculty and studious undergraduates.

"I like being at a place where the life of the mind is taken seriously," she said."I think that's great."