Greek Prime Minister Andreas Papandreou's Socialists were reelected yesterday, defeating Constantine Mitsotakis' center-right New Democracy party by a reduced but comfortable margin.

In a 3 a.m. television statement today, Papandreou hailed the new four-year term for his left-wing government as a "victory for the people" and a "defeat for all reactionary forces -- foreign and local."

Papandreou expressed his "endless gratitude toward those people who gave a chance to the forces of change to finish their work." He gave no details of his plans, but four U.S. bases, considered vital to the North Atlantic Treaty Organization's southeastern flank, could be in jeopardy.

Reports from 11,500 of the country's 14,738 voting districts put Papandreou's Panhellenic Socialist Movement (Pasok) in the lead with 46.35 percent of the vote, followed by New Democracy with 40.7 and the pro-Moscow Communists with 9.7 percent. Smaller parties shared the remaining votes.

The poor showing by the Communists freed Papandreou from any immediate pressure to close the U.S. bases.

Had Pasok failed to win a majority in Parliament, the pro-Moscow Communists had made it clear that one price they would demand for supporting a minority Socialist government was a commitment to close the bases, leave NATO and end ties with the European Community.

Although the Socialists' lead was roughly half their margin of victory of 12 percentage points in 1981, they were nonetheless assured of a solid, working majority in the 300-seat Parliament for their second term.

Interior Ministry computer projections predicted Pasok would win at least 161 seats, down from 174; New Democracy 126, up from 113; the pro-Moscow Communists 12, representing a 1 percentage point drop in the vote from 1981, and the Eurocommunists one.

Early today, tens of thousands of Papandreou's supporters took to the streets of Athens, honking horns, cheering and waving green Pasok flags.

Mitsotakis waited until 4 a.m. today to concede defeat.

Speaking on television, he said that he was "deeply worried" about Pasok's "clear victory." He warned that the economy was "heading toward catastrophe" and that democratic institutions were endangered.

He attributed his defeat to the "too short" three-week campaign and "Pasok-controlled television," which he said meant "the people were not well-informed."

Nonetheless he said, "Pasok is the new government, and I hope they will do better this time."

Political analysts said Papandreou's victory justified his gamble last March, when he precipitated early elections -- instead of waiting until October, when the normal four-year mandate would have expired -- by abruptly withdrawing support from conservative President Constantine Karamanlis in his bid for reelection and proposing to strip the presidency of most of its powers.

Papandreou argued that dropping, Karamanlis, who was seen as a brake on the mercurial prime minister, was the only way to prevent the party's left wing from bolting to the Communists.

The election results showed that despite the Communist Party's bitter attacks against Papandreou during the campaign, it not only failed to win back voters who deserted to Pasok in 1981 but lost others as well.

Ironically, some political analysts suggested that Karamanlis' last-minute, veiled endorsement of New Democracy just before the campaign ended at midnight Friday might have persuaded Communists to vote for Pasok.

Similarly, the analysts said Communists may have switched to Pasok because a huge turnout for a New Democracy rally last Thursday in Athens' Constitution Square made them fear a Mitsotakis victory.

During his campaign, unlike in 1981, Papandreou played down foreign policy issues. In recent months, Papandreou has toned down his previously strident anti-American rhetoric, although the Pasok party platform called for the removal of the bases according to a "timetable." But the 1983 agreement on the bases contains no such timetable.

Some Pasok officials have suggested that Papandreou has no intention of irritating the United States on that score for the time being. In return for the bases, the United States provides $500 million in military aid, mostly aircraft and other materiel needed to modernize the Greek armed forces.

Political analysts predicted that whether he likes it or not, Papandreou will be obliged to address the economy, which was Mitsotakis' principal reproach during the campaign and Greece's number one problem.

In the past four years, the foreign debt has increased from less than $8 billion to nearly $15 billion. Previously minimal unemployment now affects at least 300,000 -- or 8.1 percent of the work force.

Although inflation was reduced from 25 to 18 percent under Pasok, it still is three times the average in the European Community.