DURHAM, N.C., FEB. 8 -- President Reagan carried his fight against illicit drugs into a region where college basketball reigns supreme and silenced a crowd of 7,000 today with his account of the fall of one of its superstars to drugs.

Reagan's audience at Duke University's basketball arena hushed as the president invoked the memory of former North Carolina State forward David Thompson, recounting how his promising professional career had been cut short and his life "squandered on drugs."

Thompson, once the highest-paid player in the National Basketball Association, was "an extraordinary athlete, but an all-too-typical, on-the-job drug user," the president told a symposium on illegal drug use.

In three years of play for N.C. State in nearby Raleigh, Thompson led the Wolfpack to a national championship in 1974 before moving on to play professionally for the Denver Nuggets. When his skills deteriorated as he turned to drugs, he was traded to the Seattle SuperSonics.

"Two years ago, he filed for bankruptcy, millions and a brilliant career squandered by drugs," Reagan said. "Today, David Thompson is pulling his life together, and we all pray for his success . . . . "

The president's call for an end to illicit drug use received a rousing reception from the crowd, most of them Duke students. The only negative response came when he attempted to praise the state's conservative Sen. Jesse Helms (R) as "your champion senator." The crowd's boos equalled its cheers.

Reagan's appearance was protested by about 200 Duke students, who chanted against U.S. support for the Nicaraguan contras and the U.S. government's drug-testing policy for federal workers.

"Don't drop your zipper for the Gipper," said one placard, referring to a nickname Reagan has carried since he portrayed former University of Notre Dame football legend George Gipp in a 1940 movie.

The president's appearance came as part of a panel discussion at a daylong conference arranged by the university and North Carolina Gov. James G. Martin (R).

S. Malcolm Gillis, dean of the Duke graduate school, greeted Reagan, saying the panelists had decided that the best approach to treating victims of drug and alcohol abuse may be through relatively inexpensive treatment programs.