ALGIERS, JUNE 14 -- While Tuesday's first free elections in Algeria confirmed the expansion of Moslem fundamentalism from the Middle East to North Africa, for many Algerians the upset victory of the Islamic Salvation Front was more importantly a repudiation of the National Liberation Front that had dominated here since the war of independence began in 1954.

Voters are said to have repudiated the National Liberation Front(FLN from the French) in the municipal and regional voting because of its perceived mismanagement and corruption.

"In future elections, the fundamentalists cannot count on the many backlash votes cast for the {Islamic Front} to punish the FLN," said American political scientist Arun Kapil, "if only because the FLN has been cut down to size and no longer represents a monolithic force."

Official results announced tonight showed the Islamic Front won 32 of the 48 regional assemblies and 55 percent of the 1,541 municipal councils. The fundamentalists also swept all 34 municipal councils in Algiers -- including exclusive neighborhoods where the ruling political elite lives -- as well as all major cities and towns.

The FLN came in second, winning 14 of the regional assemblies and 32 percent of the municipal councils. The remaining seats went to independents and the Rally for Culture and Democracy, representing the Berber minority. Turnout was about 65 percent.

Fundamentalist leader Abbassi Madani, following the victory, accompanied his demand for early legislative elections with assurances to women and to secular parties that the Islamic Front had targeted in the campaign.

A smiling Madani shook hands on a television talk show today with Said Saadi, leader of the Berber party, which also champions women's rights and separation of mosque and state.

President Chadli Bendjedid, who is at the intersection of old and new politics, made a brief statement today expressing delight at the success of the democratic process.

Politicians were meeting behind closed doors, trying to find a way forward through uncharted waters. The first priority, according to politicians, diplomats and analysts, is the president's response to fundamentalist demands for dissolving the FLN-dominated legislature and holding elections for it in the fall.

If Bendjedid refuses the demand outright or postpones a decision, Abbassi, who is a moderate in the fundamentalist spectrum, could lose out to younger, fiery rival, Ali Belhaj.

Should the fundamentalists split, or should there be a breakdown of law and order, the armed forces could become major actors.

High-ranking officers, upset by what they took as Islamic Front efforts to subvert the army, for months have been talking to foreign journalists, warning that their patience has limits and that the government was guilty of tolerating fundamentalist "excesses."

Such talk has a familiar ring to Algerians. Since independence, the armed forces have been the real power behind the ruler. Only last year did officers formally withdrew from the FLN, as part of the dismantling of the one-party state.

Much of Madani's moderation is ascribed to making sure the armed forces have no pretext to seize power -- as when Algeria's first president, Ahmed Ben Bella, was overthrown 25 years ago.

Prime Minister Miloud Hamrouche reportedly favors an informal cohabitation between the government and the fundamentalists. Proponents of such a solution argue that the fundamentalists soon will lose much of their following, now that they control city halls and regional councils, but are dependent on government funds.

Others say the fundamentalists can do without money. They note the Islamic Front militants' work in tutoring high school students before key exams or providing hospital patients with services rarely provided by the government.

Advisers to Bendjedid have been prodding him to form his own party and drop the FLN, which has fought his economic liberalization.

The fundamentalists' electoral triumph has concentrated the minds of many Westernized, educated Algerians who see the consequences of their failure to form a broad-based democratic political movement.