Electroshock therapy, under attack as enfeebling and destructive in communities across the country, is effective in treating some of the most severe mental illnesses -- particularly major depressive disorders for which drugs and other treatments don't work, a federal advisory panel concluded yesterday.

But in giving a cautious endorsement to the limited use of this highly controversial treatment, the 14 experts advising the National Institutes of Health emphasized the importance of informing patients of the risks and benefits involved in electroconvulsive therapy, or ECT.

"The patient's freedom to accept or refuse the treatment should be fully honored," the panel said.

After examining the scientific evidence, the experts' report said it is "well established" that the treatment can produce "enduring or permanent gaps in memory" for events occurring an average of six months before and two months after the treatment. It said that patients' degree of memory problems and their reactions to it vary widely -- "extremely distressing to some and of little concern to others" -- and that adverse effects increase with repeated treatments.

Despite critics' claims, the committee was not convinced that electroshock therapy produces brain damage by destroying brain cells.

But because side effects vary depending on how the treatment is administered, the panel urged the development of standards for therapists who use electroshock treatment, which remains largely unregulated. It also called for more research on how electroshock works, as well as long-term follow-up of patients who receive the therapy. Most studies have documented benefits only on a short-term basis.

"We feel there are severe mental disorders, especially depression and mania, in which ECT is efficacious. We feel ECT can be lifesaving. However, we feel it should be restricted in its use to those individuals with the more severe forms of depression and mania whose symptoms are very intense, unremitting, and generally not responsive to other treatment," said panel chairman Dr. Robert M. Rose of the University of Texas Medical Branch at Galveston.

The panel's report, intended as an independent scientific evaluation of ECT, noted that "electroconvulsive therapy is the most controversial treatment in psychiatry." Its findings are likely to be influential in the continuing debate over the therapy, including not only the extent of medical use but its legal status. The panel called bans on ECT use in some states for involuntarily confined patients "unduly restrictive."

But opponents -- including many former patients -- who are pushing for a moratorium or restrictions on the use of electroshock therapy protested loudly at the meeting that the report was a "whitewash" and charged that the panel was biased in favor of the technology.

Doctors and patients who support ECT said they would have preferred that the report had gone further in supporting use of electroshock therapy, which has long suffered a negative public image.

Electroconvulsive therapy involves the brief application of electric current through electrodes attached to the skull to produce a generalized seizure. The patient should be sedated during each application and may receive six to 12 treatments over a period of weeks.

The treatment was developed in the 1930s and became more widely used during the next two decades. But the advent of effective drugs and concern about side effects reduced its use. A 1980 government survey estimated that more than 33,000 patients admitted to hospital psychiatric services received ECT, or about 2.4 percent of all psychiatric admissions. Critics say the numbers may run to 100,000 patients annually.

Dr. Frederick Goodwin, scientific director of the National Institute of Mental Health, cited rough estimates that perhaps 1 million to 2 million Americans "have the most serious and often treatment-resistant forms" of mental disorders for which ECT might be of benefit. The report said the "most convincing" evidence of effectiveness was for severe forms of depression, particularly for patients with a high risk of suicide.