BEIJING, NOV. 27 -- China is taking advantage of world preoccupation with the Persian Gulf crisis to prosecute of some prominent dissidents accused of being ringleaders in last year's democracy movement, according to Chinese sources and Western diplomats.

China's resolve to maintain a "tough position" on internal dissent has been strengthened by the gulf crisis and the gradual lifting of economic and political sanctions against it in recent months by the European Community, Japan and to some degree the United States, according to a Chinese intellectual, who cited such assessments in internal Communist Party documents.

In this view, China no longer sees the need to free political prisoners to win foreign economic assistance, especially at a time when its vote as one of the five permanent members of the U.N. Security Council is critical for passage of a U.S.-led resolution authorizing use of force against Iraq.

"U.S. attention is on the Persian Gulf, and a lot of the pressure on China has been lightened," said a Chinese with a relative who has been jailed without formal charges for nearly 17 months.

Earlier this month, Premier Li Peng indicated to some visiting U.S. congressmen that the cases of many of those jailed would be resolved quickly. The delegation stressed the longstanding U.S. position that detainees should be released or formally charged.

Human rights organizations estimate that hundreds of people remain imprisoned for their roles in the democracy movement, which was crushed by the army in June 1989.

In recent days, at least four jailed individuals whom authorities have branded core agitators have been charged with counterrevolution or sedition, according to Chinese sources.

In addition, Wang Dan, one of the most prominent student leaders, is likely to be formally charged in the next few weeks, according to reliable Chinese sources. Authorities also have drawn up indictments against about 10 other student leaders and intellectuals who took leadership roles in last year's protests, according to one Western diplomat, although he could not identify them.

Some university students who took part in the protests but were not jailed have been punished by their schools in recent weeks, sources said. The punishments range from verbal warnings to more serious written warnings that are placed in their secret personnel files.

At Beijing University, which was in the forefront of the protests, 137 students have been labeled political offenders within the last month for their participation in the demonstrations and have been issued warnings by the university's party committee, according to sources. Over 60 percent of those students received warnings that were serious enough to be recorded in their personnel files, the sources said.

At the Central Academy of Drama, another school active in last year's demonstrations, 11 students reportedly have been issued severe warnings for refusing food and water during a hunger strike at Tiananmen Square during the protests. A school spokesman called the reports of the warnings "sheer fabrication."

According to the sources, the Communist Party leadership has instructed university officials to complete investigations of those involved in the protests and to mete out punishments by the end of this year.

Although individual dissidents have been released from jail over the last several months, there has been no mass release of political prisoners since May. Since then, one Chinese said, "China has gained a lot without doing much in the way of human rights."

Although many participants in last year's protests have been tried, none of the accused student or intellectual ringleaders had been formally charged and taken to court until last weekend, when two intellectuals were charged with plotting to overthrow the government.

The charges against Wang Juntao and Chen Ziming, editor and publisher of the now-banned Economic Studies Weekly, are the most serious to be brought so far against intellectuals in the movement.

In addition, Liu Xiaobo, 34, a controversial literary critic, faces trial on a charge of spreading counterrevolutionary propaganda, one Chinese source said today. Authorities have accused Liu of "instigating and participating in the rioting" and of supporting armed resistance.

According to sources quoted by United Press International, Liu Suli, an assistant professor at the University of Politics and Law in Beijing, faces the same charge. Liu reportedly led the liaison group among students, workers and intellectuals in the democracy movement.

All four intellectuals, as well as student leader Wang Dan, are being held at Qincheng prison, where China detains many political prisoners.

It had been rumored that student leader Wang, 22, was going to be released earlier this year. But according to Chinese sources, he remains in prison, and Beijing University's party committee has been notified that Wang will be formally charged before next month's elections for local representatives to the National People's Congress, China's rubber-stamp legislature.

Until now, the party leadership has acted as though afraid of the reaction -- at home and abroad -- to the formal charging of Wang. But according to the sources, the party is now more afraid that Wang, who would retain his political rights if not formally charged, might be nominated as a people's deputy.