U.S. Ambassador to France Walter J.P. Curley lives in one of the great residences of France, a mansion that is a stone's throw from the Palais de L'Elysee, the French president's palace in the heart of Paris.

Shirley Temple Black, Washington's representative in Prague, lives in a 65-room palace filled with antiques on a beautifully manicured 3 1/2-acre estate.

Then there is the "residence" of Ambassador Joseph E. Lake, our man in Ulan Bator, capital of Mongolia.

Lake lives on a smaller scale. Much smaller. To be precise, 410 square feet, not counting the bathroom. In a four-story walk-up.

The architecture, like almost everything built since the Soviets made Mongolia a satellite 70 years ago, is classic neo-Stalinist: gray, crumbling concrete. The poorly lit hallways make the stairs treacherous to negotiate even in daylight, as reporters discovered on a visit in August.

For neighbors, Lake, a career diplomat who served in Bulgaria, Nigeria and Taiwan before arriving in Mongolia in July, has the Palestine Liberation Organization on the right. Japan -- whose hand-me-down furniture he used for a dining room table and chairs -- is on the left.

Lake and his assistants get a special hardship allowance (an extra 25 percent in salary) for a number of reasons. First, there is no decent local health care, a State Department official said. Political officer Michael J. Senko last year had to travel 30 hours by train to Beijing to get his broken jaw set.

In addition, virtually all the food Lake, Senko and administrative officer Theodore R. Nist eat is brought in from Beijing, which is a 40-hour train ride in the winter, when temperatures can plunge to minus-40 degrees. While mutton is plentiful, vegetables, for example, are nearly non-existent.

Then there is the extraordinarily bad air. The clever communist regime built the city power plant downstream so as not to pollute the river. The only problem is that the plant, which belches huge clouds of black smoke in winter, is upwind from the 4,000-foot-high city, making the air almost unbreathable.

Lake, with the smallest ambassador's residence, also probably has the shortest commute to work -- about 3 feet across the hall. The 685-square-foot office was recently doubled by adding a second-floor apartment. Even so, the photocopier sits on a plywood board atop the bathtub.

There is almost no social life. Picnics, even in the winter, are the main social activity. The popular local brew is fermented mare's milk, which has something of a kick to it but tastes much like buttermilk gone bad.

The diplomats and their wives nonetheless maintain an extraordinary esprit de corps, they say, because they see their jobs as a frontier adventure rather than a posting on the end of the earth.

"It is a place where we can have an impact," Lake, in town for intensive language training, said in an interview this week. "It is a rare moment in history where the United States can do something, where you can accomplish something," he said, adding that the "Mongolian people are wonderful to deal with."

Mongolia, once ruler of much of the known world, has shed Soviet domination, holding its first democratic elections in July. The nation, with a population of 2 million, is also quickly undoing its communist economic system and looking for Western investment.

Lake may be getting some additional living space soon, State Department officials said. Washington and Ulan Bator have nearly com-pleted negotiations for the only empty building in that city. The building would more than triple Lake's residential space and provide 2,400 square feet of office space. The new offices are likely to be where the U.S. mission will stay for the next decade, when officials hope an embassy will have been completed.

Meanwhile, Mongolia's ambassador here, Gendengiin Nyamdoo, is comfortably ensconced in an appropriately ambassadorial residence in fashionable Potomac.