hen James Prior first went to Northern Ireland three months ago after becoming Britain's Northern Ireland secretary, he was greeted in Londonderry by angry Catholic Irish nationalists supporting the convicted nationalist terrorists on hunger strike in the Maze Prison.

Eight weeks later, after the end of the hunger strike, Prior returned to Londonderry, only to be met this time by a much larger and even angrier demonstration by Protestant unionists. They were protesting the apparent inability of British and Ulster security forces to stop a wave of provisional Irish Republican Army terrorism that followed the hunger strike.

According to some knowledgeable officials, it was a disillusioning time for Prior, who also was jostled and verbally abused at the Belfast funeral of a hard-line Protestant unionist member of the British Parliament, the Rev. Robert Bradford, who was assassinated by the IRA. The officials said Prior began to doubt his initial belief that the conciliatory skills he had honed in dealing with tough-minded British union leaders as Prime Minister Margaret Thatcher's employment secretary could be applied to the sectarian deadlock in Ulster.

But Prior has since decided to embark on the boldest British political initiative in Northern Ireland in years, risking his reputation on his ability to cajole Protestant unionist and Catholic Irish nationalist politicians to accept British imposition of a form of shared power, creating a limited home rule Ulster leaders would never be able to agree on themselves.

Prior's strategy is to concentrate his attention on moderate Ulster politicians and risk further alienating hard-line Protestants like the Rev. Ian Paisley. Paisley appears to have recently increased his influence, at the expense of the moderates, among Ulster Protestants angry about IRA attacks and suspicious that increased cooperation between the British and Irish governments is aimed at forcing them to accept unification of Ulster with neighboring Ireland.

Prior believes, according to British officials, that unionist fears of being abandoned by Britain might cause the moderates to be more compromising in negotiations for home rule under British sovereignty. The officials said moderate Catholic Irish nationalists may be similarly influenced by pressure from the Irish government, which maintains close contact with them and endorses Prior's initiative.

Some prominent moderate unionists have even urged Prior to move quickly with his initiative to head off what they fear is Paisley's intention to try to seize total leadership of the Protestant community and break away from Britain. They warned this could lead to civil war in Northern Ireland.

Without underestimating the potential influence of Paisley, an effectively bombastic evangelist orator with a keen sense of political timing, Prior will try working around him, the officials said. The "Third Force" of armed Protestant unionists that Paisley has threatened to unleash on the IRA and possibly the British does not appear to amount to more than a few hundred disorganized Paisley followers, they added.

Authorities in Northern Ireland struck for the first time Thursday against Paisley's forces, arresting a dozen persons in house raids, Reuter reported from Belfast Friday. Police said a number of men were released on bail after being charged with operating an illegal vehicle checkpoint near the province's border with Ireland.

Prior "is aiming high," said a government minister familiar with his strategy. He said Prior and Thatcher would likely face a nasty fight in Parliament from hard-line Ulster unionists and right-wing conservatives if the government succeeds in introducing home rule legislation for Northern Ireland. But he and other senior conservatives added that Thatcher gave Prior "a blank check" to try such an initiative when he reluctantly agreed to be moved to Northern Ireland from his economic post.