The news hit Washington's Ethiopian community like a bombshell. For days its members talked of nothing else. A few called their bosses and said they were not coming to work, they were going to hide. Others called lawyers. Community leaders set up emergency meetings.

The U.S. State Department, citing "stabilized" conditions in Ethiopia, had revoked a special visa arrangement that had allowed hundreds and possibly thousands of Ethiopians to live and work indefinitely in the United States because of the turmoil and violence that have gripped their country since a Marxist takeover.

The initial shock has abated, but the bitterness, outrage and fear created by the decision still dominate the Ethiopian community here, estimated at 5,000 members living in enclaves along 16th Street NW and in Takoma Park, Arlington and Alexandria.

"If I was ever caught back home I would not have a minute to live," says a 31-year-old, part-time student and taxi-driver who, like hundreds of others, has received a notice to leave the United States.

He is appealing a denial of his request for political asylum. He says he was a member of an opposition political group and that six of his friends were killed by the government.

"If you could see the terror the news articles about the decision created in people . . . ," says Tsehaye Teferra, president of the Ethiopian Community Center. His remark came not long after 700 Ethiopians had turned out to discuss the new policy with a local official of the U.S. Immigration and Naturalization Service.

State Department officials say the decision to change the policy last August reflected two things: a finding that random violence has abated somewhat in Ethiopia and a desire to stop what they regarded as an abuse of the visa process by Ethiopians. The move is aimed at those who have come to the United States in the past two years, rather than at longtime residents, officials said.

INS has not made a special effort to seek out Ethiopians whose visas are no longer being extended and no one has been deported yet because of the new policy. After Ethiopians receive an INS notice to leave the United States, they can apply for political asylum, a process that can take up to 18 months to complete and one the State Department says will protect the truly endangered from expulsion.

But most Ethiopian asylum requests are being turned down for lack of sufficient proof that the petitioner would be in personal danger if he returned to his country. For example, at the end of January, 1,389 asylum applications from Ethiopians were on file. Of the 159 processed between October and then, 119 were denied and 40 approved.

Eventually some Ethiopians "will be deported because there are so many of them," said Dan Bartlett, assistant district director of INS for deportation in Washington. "Somewhere down the line, departure will be enforced." At that point, Ethiopians can try to find another country of exile if they do not want to go home.

While INS does not have figures on the number of Ethiopians in the United States nor the number affected by the new policy, the nationwide Ethiopian Committee on Immigration, formed to lobby against the new policy, estimates there are at least 25,000 in this country and says "the overwhelming majority" are affected by the new ruling.

The 1974 revolution that overthrew Emperor Haile Selassie transformed the Ethiopian community in Washington from a small, transient student population to a heterogeneous, more settled exile group generally believed to be the largest Ethiopian settlement in the United States. There are also substantial settlements in New York, Dallas and Los Angeles. A cultured people from a country with a historical tradition dating back to biblical times, Ethiopians are also free of the national inferiority complex engendered by colonialism in many other African countries. Neither very poor nor wealthy, they seem to be holding their own in this country, shunning welfare and crime.

Almost all say they would like to return home if and when conditions there really show drastic improvement. But they believe that is unlikely to happen soon, so over the past few years they have formed the basics of a resident community here.

The Ethiopian Community Center was organized two years ago as a social anchor and mutual aid group for their close-knit society. Each Sunday an Ethiopian priest, the Rev. Petros Abba, says mass in the rite of the Ethiopian Orthodox Church.

And every Saturday morning in Georgetown University classrooms, Ethiopian emigres labor to inculcate their history, culture and language in a new generation that has at best a faded memory of their parents' homeland.

One recent morning, Aklilu Hapte competed with an electric guitar twanging through an open window as he lectured a group of teen-agers, outfitted in Adidas sneakers and jeans, on the contributions of the Ethiopian Orthodox Church.

In a room down the hall, Tesfaye had a more difficult time. As she held up the Amharic alphabet to nine preschool children, most of whom were born in this country, and led them through a recitation of the letters, a plaintive request was repeatedly made--in English--by one of the children: "Can we play a game now?"

Ethiopians here have gravitated to such jobs as parking cars, serving cocktails and driving cabs. But they also work at local universities and international agencies. Some have opened small businesses, including nine restaurants that led one Ethiopian to observe: "Whenever there is trouble in the Third World, restaurants mushroom in Washington."

Besides being a place where Americans can taste the spicy national cuisine of Ethiopia, which is served with a bread called enjera, these restaurants serve as a vital social link for the Ethiopian community. One recent night in the Lalibala on S Street NW, cologned and fashionably dressed Ethiopians packed the small room clapping to the sounds of an Ethiopian band and enjoying the crooning of Amharic love songs by a visiting Ethiopian singer. Between the tables they danced the shoulder-jerking esketa.

Ethiopians hotly deny that such scenes suggest many recent arrivals are trying to stay for economic reasons, as some U.S. officials contend.

"If that was the case," said Zwedu Haptemariam, a member of the Ethiopian Committee on Immigration, "we would have applied for political asylum four or five years ago when it was easier. Ethiopians didn't do that; they were waiting for things to change."

Melvin Levitsky, senior deputy assistant secretary of state for human rights, said the decision to revoke Ethiopians' special visa status, called extended voluntary departure, was made because reports indicated that "the government was not randomly killing and savaging the opposition the way it had before. That's not to say there are no human rights violations [in Ethiopia] and it has nothing to do with what we think about the government."

U.S. officials, in fact, appear to think very little of the Soviet-backed government of Mengistu Haile-Miriam, which they have publicly called "vile" and "savage" in statements since the visa policy was changed. The State Department's most recent assessment of human rights in Ethiopia concluded that although the level of abuses was "significantly lower" than in previous years there is "no legal protection against abuses . . . torture is still used occasionally on prisoners . . . disappearances do occasionally occur in Ethiopia . . . and no criticism of the government is allowed in any form in any forum."

The visa change comes at a time when the United States continues to take in Ethiopian refugees. In the last three months of 1981, for example, the U.S. government accepted 469 Ethiopian refugees. More than 2,800 others, already approved by the INS, were awaiting transportation and sponsors to enter the United States at the end of February.

Concern about Ethiopians circumventing this official refugee entry route forced the visa policy change, according to one U.S. government source. The move was meant to close "a giant loophole" by which increasing numbers of Ethiopians came to this country in 1980 and 1981 on tourist or student visas, and then applied for the special visa extension once they got here. In this way they were skipping over others applying to come as refugees, the source said.

Most Ethiopians dispute that things have changed for the better at home. "I don't agree with the contention that things have stabilized at home," said a 47-year-old Ethiopian who works for an international agency here and declined to be named. "If the comparison is with the 'Red Terror,' yes, there is less killing. But compared to what was before that, I certainly would not say it has stabilized," he said.

The "Red Terror" was the period of vicious street fighting in 1978-79 when an estimated 5,000 to 10,000 men, women and children were killed in Ethiopia.

Someone who did agree with the State Department's decision was the charge d'affaires of the Ethiopian Embassy. Tesfaye Demeke called it a "legitimate" decision because "Ethiopia has one of the most stable governments in Africa."

His government has offered an unconditional amnesty to all exiled Ethiopians, who "would be better off morally, maybe not materially, if they could utilize the skills they have acquired for the betterment of the people at home rather than engaging in the manual labor they do here now," the diplomat said.

Demeke said some Ethiopians were already returning home and he blamed the "negative" U.S. press coverage of events at home for the reluctance of others to do the same.

Aminu Hussein of Atlanta, who has been in this country 10 years, is one of those returning. Promised a job in the Foreign Ministry, Hussein said he is going home to "serve his country and implement my education." He said he thinks other Ethiopians exaggerate their fears about returning home, and though he expects some problems at home, he feels "it will not hurt to try."

But Hussein is in a minority among Ethiopians living in the United States. Most are very skeptical about the amnesty offered by their government and cite a government proclamation last month that said anyone who fled or attempted to flee Ethiopia would be imprisoned for five to 25 years. Their skepticism ranks only behind their bewilderment at the treatment they are getting from the United States.

"I'm deeply astonished," said 28-year-old Adane Tesfakiros, a part-time drama student, "that this administration lets people from Cuba or Poland in with a bucket of flowers in one hand and a flag in the other and says 'welcome.' But with us, from a country whose leader portrays himself as the Castro of Africa and who has signed a pact to serve the interests of the Soviet Union, it is different."