Broadcast journalists reacted with wary jubilation yesterday to the news that retired Army general William C. Westmoreland had dropped his $120 million libel suit against CBS over the 1982 documentary "The Uncounted Enemy: A Vietnam Deception."

Some said the CBS victory would dissipate any possible "chilling effect" on news organizations fearful of provoking public figures with controversial journalism. Others said the chilling effect already was being felt.

Mike Wallace, correspondent for the 90-minute documentary that charged a "conspiracy at the highest levels" to suppress military intelligence during the Vietnam war, said from New York, "I feel satisfied that the broadcast told the story accurately in the first place, and that, it seems to me, is where it stands now." Asked about a potential chilling effect, Wallace said, "I don't believe that's going to be the case. Let's wait and see."

There have been no similarly controversial, investigative CBS documentaries in the three years since "Uncounted Enemy" aired.

George Crile, producer of the report, said he was "delighted" by Westmoreland's decision and considered it a personal vindication. Crile said he had no plans to leave CBS News. He said Van Gordon Sauter, the CBS Inc. vice president who oversees the news division, had said Crile will return to work on other documentaries.

A 1982 documentary on drug traffic in Miami, which Crile worked on in the aftermath of "Uncounted Enemy," was never aired.

"All the people at CBS have been terrific since the trial actually started," Crile said. Before the trial, he expressed dismay with such colleagues as Burton Benjamin, author of an inhouse report, later made public, that found the documentary had violated CBS News guidelines. Asked about that, Crile said yesterday, "Look, it's history."

Westmoreland, in his news conference yesterday, referred to the joint statement issued by him and CBS as having constituted an "apology."

"I don't know how he came to interpret it that way," Crile said. "Maybe he was thinking of what George Aiken said about Vietnam: Declare victory and leave. Perhaps in that context he could justify it. But it was not in any remote notion of the word an apology of any sort."

Wallace said, "No, I wouldn't call it an apology. I can understand his desire to frame it in those words." Asked if he would do the documentary today exactly as it was done in 1982, Wallace said, "That's hard to say. It would certainly be 99 and 44/100 percent word-for-word." Including the word "conspiracy"? Wallace said, "I think there was a conspiracy."

Osborn Elliott, dean of the Columbia University School of Journalism, compared the Westmoreland case to the suit filed by former Israeli defense minister Ariel Sharon against Time magazine, a suit Time recently won.

"The only conceivable benefit from these two suits is that they may possibly have a chilling effect on public officials suing news organizations," Elliott said. "But I think the bad effects will outweigh the good in that reporters and editors are already holding back on stories they might have done, spiking stories they might have run, for fear of being sued.

"That's just a hunch," Elliott said, "but I think it's true."

Fred W. Friendly, former CBS News president, said the long trial "can't help but have a chilling effect on the next time somebody wants to do a hard-hitting program." Friendly said of Westmoreland's withdrawal, "It isn't a victory; it's a way out." He added that such lawsuits may continue until network television invents its own equivalent of the letters to the editor carried by newspapers.

"The Achilles' heel of broadcast journalism is that you can't talk back to your television set," Friendly said. "They got away with this by the skin of their teeth. If they don't understand that they've got to find a way to let people answer back, then the whole thing is a disaster."

CBS News did offer Westmoreland 15 minutes of unedited air time after the broadcast and before the filing of the lawsuit, but he declined the offer.

William Leonard, who was president of CBS News when production of the broadcast began, said the CBS victory was "a tremendous shot in the arm, just as it would have had a terrible dampening effect if we had lost." Asked to respond to an ABC News report that CBS had made "concessions" in reaching the settlement, Leonard said, "Westmoreland's people capitulated, it seems to me. They said, 'Let's get out of here.' "

For all the rancor of the trial, and in the new spirit of apparent detente, Crile said he felt Westmoreland was a "tragic" figure who, in filing the suit, had been "led down the garden path" by political conservatives who wanted to teach the media a lesson. Wallace said additionally that during his weeks in the courtroom with Westmoreland, "I developed more than a passing or casual relationship with him and especially with Mrs. Westmoreland. I admire her immensely."

When he was hospitalized in December for exhaustion aggravated by his long days in the courtroom, Wallace, 66, received many bouquets of flowers. The one that most surprised him, he said, was the one sent with a get-well card signed by Gen. and Mrs. William Westmoreland.