Hidden in the labyrinth of narrow cobblestone streets in the Baab al-Huta quarter of the Old City, a tiny group of gypsies is clinging to its vanishing culture like the grapevines that cling to the ancient walls surrounding their narrow enclave.

It is among the least-known cultures in a city rich with ethnic and religious diversity, and the gypsies would just as soon keep it that way.

Of the gypsies who wandered to the world's edges from northwest India nearly three centuries ago, about 300 are left in Jerusalem. As in many other places, gypsies here are regarded as inferior by their Arab neighbors. Their women are said by the Arabs to be faithless, so the gypsies marry among themselves and retain their Asian faces with their prominent cheekbones and distinctive complexions.

Some of them speak Nawari, the language of the gypsies that is mixed with Persian, Armenian, Kurdish and Arabic, and some celebrate their weddings and other festive occasions with the traditionally raucous gypsy songs and dances that have been passed down for generations.

Mohammed dib Abu Salim seems to know, however, that it will not always be so, as he sifts nostalgically through a pile of faded photographs and documents that trace his family's lineage as muhktars (headman) of the Hadadin gypsies of Palestine.

The Hadadin were the blacksmiths and tinkers who drifted from village to village, practicing their craft where a coin or two could be earned or stolen, and then moving on with their donkeys and their women trailing behind them -- usually in that order.

Eventually, they settled in Jerusalem, borrowing the language and religion if their Arab neighbors for convenience's sake, but stubbornly holding on to their own culture.

They might not have been respected by the distrustful hosts, but Salim's pride in his people is unmistakable as he shows a visitor a tattered photograph of his father, Abed ibn Ibrahim Salim, standing in a stiff pose along Jaffa Road in 1927, when the now-busy thoroughfare was no more than a dirt track.

The gypsies were living in tents then in the Orthodox Jewish Mea Shearim quarter, and Salim's father one day intervened in a fight between the Arabs and Jews, separating the two groups. The British governor happened to witness the incident, Salim said, and the next day paid a visit to the gypsy tents.

"My father was afraid he would go to jail for getting into the fight, but the governor gave him a certificate [officially recognizing] him the muhktar of the gypsies," Salim said.

A romanticist in the gypsy tradition, and a practiced storyteller, Salim recounted the folklore of how the gypsies of India happened to come to Palestine.

About 250 years ago, according to gypsy tradition, Baharamgur, the shah of Persia, surveyed his kingdom and discovered that while most of his subjects seemed to be content, the poorer peasants were not happy. He sent a request to Shangul, king of India, to choose 10,000 gypsy men and women with instruments to entertain the peasants and brighten their dreary lives.

When the gypsies arrived, he gave each one of them one ox and one donkey, along with gernerous supplies by which the gypsies could sustain themselves by farming. But instead, Salim recounted with a smile, the gypsies slaughtered and ate the oxen and consumed the wheat, thereby angering the shah so much that he banished them to a life of wandering across the empire, their only company being the dogs and wolves that followed them.

While many wound their way to Europe, Salim said, some of them came to Palestine, which was then occupied by the Turks. They would stay here only in the summer and then wander with their donkeys throughout the Arab world.

Three brothers -- Salim, Nimir and Gello -- stayed, with Salim becoming a muhktar and living with Nimir, and Gello moving to Gaza, where he married 12 women.

When one of Gello's wives fell in love with a slave and killed her husband, Salim said, the other wives married nomadic gypsies and settled in Gaza, where there is still a community of about 200 gypsies. Another 30 gypsy families are scattered through the West Bank, most working as blacksmiths.

The Gaza gypsies are looked down upon by Salim's tribes because they are the rekatzin, or the entertaining gypsies, whose men are said to be worthless exploiters and whose women are regarded as prostitutes. Some of them have moved to Jordan, where the women occasionally are found as camp followers, working their profession around Army bases.

Salim recalled that at the turn of the century there was a dispute between the Nimir and Salim families in Jerusalem, and the Nimirs paid a thief to kill Salim's grandfather and bring them his left hand. But when Ibrahim discovered the plot, the Nimirs were tied to the tails of horses and walked from Ramie, on the coastal plain, to the Turkish police in Jerusalem, where a peace offering was made.

In 1939, the Hadadin gypsies moved from their tents to crude huts they built on the Mount of Olives, but they were driven out by the British because Arab guerrillas used to hide their weapons in the huts.

There has been relative peace for Jerusalem's gypsies since then, but they are constantly on the brink of losing their cultural identity.

Virtually all of the Jerusalem gypsy men have given up blacksmithing as a lost art in the city, and most of them work for the city government as janitors and porters. They live in rented houses in the Old City, surrounded by Arabs but still not fully accepted by them.

The younger gypsies are rapidly forgetting their customs, and many of them have given up Nawari for Arabic and Hebrew, although the gypsies tend to be apolitical and favor neither side in the Arab-Israeli conflict.

Even Salim, who is 47, said he rarely speaks the gypsy language anymore, adding, "In public, I'm ashamed to speak it, because the Arabs will only mock me. We speak it inside our homes."

Fortunetelling is also becoming a lost art among the Jerusalem gypsies.

"There are a few left, but they all tell lies. I don't believe them anymore," Salim said.