Tua Myers and her children live on one of the loveliest pieces of real estate in the world. The cobalt-blue waters of the Pacific lap gently on the white sands 100 yards from their door, and the stunning beauty of the cloud-topped Wainae Mountains looms above. Condos here sell for $125,000, and the Sheraton rents an ocean view for $125 a day, mountain view for $110.

But the Myerses have no home. They are among Hawaii's homeless "beach people," and they live in an Army surplus tent near a muddy lagoon.

They are part of a small but growing group of about 300 homeless people who have laid claim to beach lands on the island of Oahu. The beach people have become an emotional and political issue on Oahu, where housing is scarce and the most expensive in the United States. The average house sold for $183,000 this year.

The beach people are poor. Many live on the land because they assert that their Hawaiian ancestry gives them rights to the property under the 1920 Hawaiian Homes Act. The law set aside 200,000 acres to be preserved for native homesteading to compensate for the encroachment of the haoles, the white settlers who came here as missionaries and whose descendants reaped profit from sugar cane, pineapple and, ultimately, tourism.

"Some people think we like living this way. We don't," said Myers, who has been on welfare since a bitter divorce. "Sometimes, at night, we are just crying. The weather is so hot, and the bugs, the centipedes." She perspired profusely as she greeted a visitor inside her stifling tent, which lacks electricity. Their water comes from a hose near the portable toilets and outdoor shower erected by the city government.

"This place is bad, but we try our best," Myers said. She shares the tent with four children, 9 to 15 years old. She has placed carpet scraps over wood scraps to provide a floor. Old car seats and mattresses are the furniture. Food is stored in an Igloo cooler and cooked on a Coleman stove. The diet includes Spam and limu, an edible seaweed that the children collect in the surf and sell to a local market.

Squatters have lived on several Hawaii beaches for years, but the issue came to a head last spring, with growing numbers residing on public beaches, taking over desirable campsites, building shanties and offending the tourists.

"It looks like a suburb of some Central American slum," Honolulu Mayor Frank Fasi told the Honolulu Star-Bulletin last month, explaining his order to tear down shanties in an area he described as a "pigsty." Squatters were relocated to various sites, including the city-owned spot where Myers and about 40 others live in donated Army tents.

The demolition order by the mayor, who runs Oahu's city-county government, ended a running battle with beach people who had obtained permits to camp but overstayed their welcome, erecting ever-larger structures out of plywood, plastic, ropes and wire.

On June 3, a dozen beach people were arrested and several injured when police arrived to tear down their houses. A contingent of more than 40 homeless later headed for Honolulu where they staged a sit-in at the state Department of Hawaiian Home Lands, bringing their pots, pans and bedding for a long stay. A dozen more were arrested there.

Under the 1920 law, the Home Lands agency distributes land under 99-year leases to residents who have at least 50 percent Hawaiian ancestry. Hawaii had a population estimated at 300,000 when Captain James Cook discovered the islands in 1778. Thereafter, disease and encroachment decimated the native population. Today, about 300 people claim to be 100 percent Hawaiian, and an estimated 30,000 are considered 50 percent native. The native population is also the islands' poorest, with more than half having no reportable income, according to a 1975 state study.

The beach people's sit-in was staged to demand faster action in getting land. But the much-criticized department has a waiting list of more than 9,000 families -- while only 3,000 families have been given homesteads in the program's 60-year history. The cumbersome process has been slowed by the lack of money for improvements needed before land can be leased.

"Overnight, millions of dollars are made available for education and housing of military personnel, while we Hawaiian natives are relegated to refugee status, pushed from place to place, marginalized. Making us strangers in our own land," Moanikeala Akaka, of the state Office of Hawaiian Affairs, said.

"Beach people are a reflection of our overall housing shortage, and also of the state government policy toward the Hawaiian minority," Gregory Pai, chief economist of First Hawaiian Bank, said. "You have people waiting 30 years to get their land, and it has become a ridiculous situation."

Public opinion on the beach people is divided, judging from the barrage of letters and public statements to the Hawaiian media. Many criticized the government for what they called harsh treatment of the homeless, while others called the beach people freeloaders who hog the beach and spoil the view.

Government officials said they could not place the homeless at the head of the waiting list for land, but a partial solution was enacted this month when the City Council approved a $1.2 million project using federal funds to build a 64-unit dormitory-style facility for the homeless on land donated by the Catholic Church.

Myers and her children would be eligible for such housing. Meanwhile, they stay at the beach.