There is a new mood these days in Palermo, the Sicilian city that is known as the capital and stronghold of the Italian Mafia. The ongoing crackdown on Mafia criminals here that has enabled police to put several hundred suspects behind bars, solve scores of unresolved crimes and complete their map of the ancient criminal organization also has brought an unusual sense of optimism and hope to this island capital.

"People feel exhilarated, the way their ancestors did a century ago when Garibaldi brought his Red Shirts here to drive out the Bourbon monarchs," said the Rev. Ennio Pintacuda, a Jesuit sociologist who believes that Palermo is at a turning point in its attempt to find a new identity.

"It's a tough battle, but we will win it," Italy's Socialist prime minister, Bettino Craxi, said on a visit here two weeks ago for an anti-Mafia summit with top Roman and Sicilian investigators.

His new-found optimism, which conversations here indicate is shared by most Palermo residents, was echoed by Interior Minister Oscar Luigi Scalfaro. Scalfaro said during the summit that although Italy had let down its guard against organized crime while it dealt with terrorism, things had now changed. "The presence of the state is now constant in Italy," he told his listeners.

But while the successful investigations and unprecedented grass-roots opposition to the Mafia have done away with the resignation and fatalism that characterized attitudes here for decades, people in Palermo say the battle is far from over.

"The Mafia is no longer considered invincible, but if support from Rome is not sufficient, and if significant political and economic changes do not follow, then this will turn out to have been nothing more than a brief truce in the war against the Mafia," said Pintacuda.

Palermo's citizens have drawn courage from a variety of factors. The success of the official anti-Mafia probe, furthered by the revelations of a former Mafia boss, Tommaso Buscetta, has had a notable effect. "People see what the magistrates have done in recent months and have come to the conclusion that something can be done after all," said Sicilian Communist leader Luigi Colajanni. Colajanni's predecessor, Pio La Torre, who was the author of a national law that gave anti-Mafia probers new investigative powers, was assassinated by the Mafia in April 1982.

A recent Sicilian law providing for anti-Mafia education in local schools also appears to be paying off. About 10,000 people, most of them young, turned out for a major anti-Mafia march in late October that began in Ciaculli -- the Palermo suburb that is home to Michele (The Pope) and Salvatore (The Senator) Greco, wanted by police as the Mafia's current top "bosses of the bosses."

"Today's young people feel they have nothing to do with the Mafia, and furthermore they're not afraid of it," said the Rev. Nino Fasullo, a Redemptorist priest who helps produce an influential leftist Catholic bimonthly.

"The trend is definitely against the Mafia," said Luca Orlando, a young Christian Democratic city councilman who believes Palermo is at a crucial point. He said many local groups as well as individuals were now openly talking about the Mafia and how to get rid of it.

But this is not likely to be easy. Many people here fear that the Mafia may already have begun reorganizing itself so as to avoid further damage from the investigation.

In addition, there is a widespread belief that the Mafia has been able to survive and flourish since World War II only because of high-level protection and connivance from members of key political groups operating within a political system characterized by graft and patronage. If the system does not change, the battle against the Mafia cannot be won, people here say.

The feeling is that, with the exception of the Communists, all of Palermo's political parties share the blame. But the Christian Democrats have come under the greatest public suspicion. With 43 percent of the vote, they have controlled the Palermo city council for more than 40 years. The party's top leaders are blamed for most of the administrative and economic problems in a city with at least 60,000 people unemployed, extensive slums and inadequate municipal services. The fact that there have been five different Christian Democratic mayors in the past three years indicates the depth of the party's crisis, party sources say.

Last month, magistrates here arrested on Mafia-related charges two wealthy cousins who had run the city's independent tax collection agency for decades. Until six months ago, the two were prestigious, card-carrying Christian Democrats.

Earlier, the magistrates jailed on similar charges Vito Ciancimino, a former Christian Democratic mayor who is believed to have played a key role in the massive real estate speculation of the 1950s and 1960s that saw new suburbs built overnight on lands owned by local bosses and that some say was the basis of postwar cooperation here between Mafiosi and local politicians. "The problem of Palermo is the Christian Democratic Party," said Fasullo.

Spurred by these arrests -- as well as by the suicide last month of Rosario Nicoletti, a top Palermo Christian Democrat who, before killing himself, said he felt the climate of suspicion to be "intolerable" -- Christian Democratic leaders in Rome and Palermo have taken the first steps to reform. A specially appointed party "commissar" has pledged a thorough change.

But skeptics here fear the promised reforms may turn out to be superficial. There has been no attempt, for example, to expel the region's most influential Christian Democrat, Salvo Lima, from the party. Currently a member of the European Parliament, Lima was named as a Mafia suspect years ago by the Italian Parliament's first anti-Mafia commission.

A variety of Catholic groups are now pushing hard for change, backing a new Catholic political organization called The City for Man, whose clean-hands image may make it an alarming rival for the Christian Democrats in municipal elections in the spring.

Another problem is whether the Palermo team of special investigators will be able to continue its inquiries unharassed.

On his visit here Nov. 26, Craxi pledged that the investigators will continue to receive full logistical and moral support from Rome. "No obstacles will be placed before the magistrates," he said.

However, Mafia retaliation could threaten the future of the investigation. Police and political observers have speculated that if anything were to happen to Judge Giovanni Falcone, the de facto leader of the investigating team, the probe could be compromised.

"He's got most of the stuff in his head. He's a walking archive, and it would be a disaster if anything happened to him," said a western investigator formerly involved in the Italian probe.

Falcone is believed to be one of the most highly protected public figures in Italy. He is escorted everywhere by more than a dozen plainclothes and uniformed bodyguards, and his apartment house is protected by a bulletproof police guardhouse erected outside.

In the past six years, Mafia henchmen have succeeded in murdering some of Sicily's top officials, including the president of the Sicilian region, Piersanti Mattarella, killed in 1980, and the government's anti-Mafia high commissioner, Gen. Carlo Alberto Dalla Chiesa, slain in September 1982.

In July 1983, a Mafia bomb placed in a parked car outside his home killed Judge Rocco Chinnici, a crusading anti-Mafia judge who at the time of his death headed the Palermo judicial investigation office.

Earlier this week, Mafia thugs murdered Leonardo Vitale, who 11 years ago became the first major Mafia informer in Palermo. Vitale's mother and wife were wounded, and shortly afterward, the brother of an informer on the Neapolitan criminal organization known as the Camorra also was murdered in Sicily.

The increase in Mafia ruthlessness, exhibited in an uncontrolled gang war that has taken more than 300 lives since it began in 1981, has cost the Mafia much of the tacit consent it had here over the past several decades, when it was seen by many as a protector and employer. "People started asking themselves what they could possibly have in common with such men," said Luca Orlando.

He added that the Mafia also miscalculated the effect on the government that the murder of Dalla Chiesa, a northern Italian general, would have.

Many believe that it was the Dalla Chiesa murder that convinced government leaders in Rome that they faced a real challenge to their authority and that it was necessary to put an end to years of negligence toward the Italian south.

But it is unclear whether the central government is prepared to make adequate changes. Observers here, from police and magistrates to local politicians, are convinced that Rome must provide Palermo with substantial development aid along with moral and military support.

In short, said one local politician, Rome "has to decide once and for all if Sicily is part of Italy or simply a faraway province of Libya."