As luxury hotels, fancy restaurants and high-rise condominiums multiplied along its spectacular waterfront over the past decade, few local engineers and bureaucrats paid heed to Boston's dirty little secret.

To be sure, the evidence was there: the stink that wafts from the harbor; the murky brown solids and greasy slick along the shores; the cancer detected in local flounder last summer.

But, by and large, the federal, state and city governments neither saw, heard nor spoke evil of the city's multibillion-dollar commercial boom or its infrastructure.

Ten days ago, in a move that stunned the state's political and economic establishment, a superior-court judge halted all sewer hookups, including future permits as well as those dating to June 13, 1983. The failure to build adequate waste-water plants had made Boston Harbor "a cesspool in the region's front yard," Judge Paul Garrity said.

Garrity's order effectively stopped more than $150 million worth of ongoing construction in Boston and 42 suburbs served by a common sewer system. About $3 billion in future projects were thrown into limbo.

Wednesday, after the state attorney general's office argued that Garrity's order would cause an "economic meltdown," the Massachusetts Supreme Court lifted the ban. Hours later, the regional administrator of the federal Environmental Protection Agency said he would ask the Justice Department to file suit in federal court to reinstate the ban.

Monday Garrity is expected to announce whether he will impose another curb, one affecting only future hookups. He also will resume hearings on whether to place the Metropolitan District Commission, which administers the sewer system, under court receivership.

Meanwhile, the Massachusetts legislature is expected to take up a bill to give control of the sewer system to an independent authority.

The uproar in Boston has focused national attention on the uneven results of the federal government's ambitious water-pollution cleanup. More than $50 billion has been spent nationwide on new sewer systems since Congress passed a law in 1972 requiring waters to be "fishable and swimmable" by 1977.

The national deadline repeatedly has been extended. Cost estimates have risen as federal funds for sewer construction have been slashed.

However, while most major cities were making substantial progress in the past decade, competing fiercely for federal sewage grants, the sewer division of Boston's Metropolitan District Commission, underfinanced by the legislature and mired in patronage, remained bureaucratically paralyzed.

"The massive and unlawful pollution of Boston Harbor has gone on for years, threatening the public health and welfare," said Michael R. Deland, EPA's regional administrator. "It is a national disgrace."

Some 12 billion gallons of raw or partially treated sewage, much of it contaminated with toxic chemicals, spills into the harbor each year. About half comes from 108 pipes that bypass the system's two decrepit treatment plants.

Most of the equipment dates from the turn of the century. The Smithsonian Institution asked for the 1860 Corliss steam engine from an east Boston pump station, but the commission won't give it up because it is still in use.

Although the 1972 law required cities to give all sewage "secondary" treatment -- a biochemical process using bacteria to consume organic wastes -- Boston's two plants merely separate liquids from solids, add chlorine and dump everything into the harbor. The plants, built in 1953 and 1968, break down often and overflow when it rains.

In contrast, Washington reached 100 percent secondary treatment of its sewage four years ago, as did Chicago, Detroit and Houston. New York, which has been on the defensive over the fouling of New Jersey beaches, gives about two-thirds of its sewage secondary treatment. This year, Boston-area beaches were closed for 120 days because of contamination. Three-and-a-half square miles of the harbor's shellfish beds are permanently shut; 3.8 square miles are off limits intermittently.

"A significant portion of the shellfish in eastern Massachusetts is probably contaminated," said Douglas Foy, executive director of the Conservation Law Foundation of New England, "but no one has tested it."

Foy, whose group has filed suit in federal court to force a cleanup of the harbor, attributes the political inertia here to a "flush and forget" mentality. The 43 cities and towns served by the system "are addicted to running their pipes into Boston Harbor because its cheap," he said. "It's out of sight, out of mind."

Sewer charges in Boston and its suburbs are among the lowest in the nation. The legislature and successive governors have been reluctant to raise the rates.

The estimated cost of building secondary plants and modernizing the system is $2 billion.

The crisis has embarrassed the administration of Gov. Michael S. Dukakis (D). Dukakis has made "a lot of noise about acid rain, but has not thrown his muscle behind the Boston Harbor cleanup because he wants to look pro-development," Foy said.

Dukakis aides say they have lobbied hard for the legislature to create an authority that would raise revenue bonds and operate outside the civil service. A state Senate bill passed in October, but the House has repeatedly delayed.

Deland, who joined EPA last year, also blames former EPA officials for not filing suit earlier. "Nobody's hands are clean," he said.

EPA recently denied Boston a waiver under provisions allowing some coastal cities to avoid secondary treatment.

Nov. 28, Garrity, who had been struggling for 18 months with a suit over the harbor, was watching the evening news when he saw state House Ways and Means Committee Chairman Michael Creedon, after again postponing action, boast that his reaction to court orders was "to ignore them."

"I said to myself, 'Ok, that's it,' " Garrity said in an interview. The next day he slapped on the injunction against hookups.

A former antipoverty lawyer, Garrity likes to call himself "an Irish street kid." He placed the chaotic Boston Housing Authority in receivership in 1979, and it emerged five years later substantially straightened out, by most accounts.

In December 1982, Quincy, a southern suburb, filed a suit against the Metropolitan District Commission that led to Garrity's order. The suit stemmed from complaints by residents of the picturesque peninsula of Houghs Neck.

"It's a beautiful area, with turn-of-the-century homes," said Robert Daylor, an engineer who lives by the water. "People on the coast sail and swim all summer."

But in recent years, he said, "visible scum was on the water. You could see condoms, tampon applicators and fat globules on the beaches. It would be 90 degrees, and we'd have to keep our kids out of the water."

Finally, he said, "we got angry."

Garrity, who is no relation to U.S. District Court Judge W. Arthur Garrity of Boston busing-crisis fame, acknowledges that his sewer ban was "draconian," but said it was a matter of "people over polluters."

"It is regrettable in terms of the vitality of democratic institutions," he added, "that a judge has to kick ass to get the political branch to do what is in the public interest."