BEIJING -- Last month, a major Japanese newspaper was preparing to publish a special edition to announce that China's supreme leader, Deng Xiaoping, had died.

But about an hour before deadline, reporters at the Mainichi Shimbun were still unable to confirm the initial anonymous tip that Deng, 86, had died hours earlier, on Nov. 20 at 4 p.m. The story was not published.

Chalk up another rumor about Deng's demise that was off the mark. Although he has not been seen in public since July 3, Chinese officials insist he is in good health.

The incident is a telling example of how difficult it is for foreigners -- and even ordinary Chinese -- to know what is going on behind the heavily guarded ocher walls of Zhongnanhai, the working and living quarters of China's Communist Party leadership. The walls of Zhongnanhai, next to the ancient Forbidden City, seem to be as impenetrable as those of the Kremlin during an earlier era.

"The situation is as opaque now as it has been for a long time," said one veteran Western diplomat. A few years ago, because of China's reforms and general opening to the outside world, information was becoming easier to obtain, and Chinese from all walks of life spoke much more freely. But since the June 1989 army crackdown on prodemocracy demonstrators, that has changed.

"Over the last year, people have been dusting off their old classic China-watching skills -- looking at who in the leadership has signed condolences, where they are appearing in photographs -- because there is little else for us to go on," the Western diplomat said.

It is virtually impossible, for example, to obtain information over the telephone from a government office. Requests for interviews about even the most basic subjects may take days to clear. Almost all Chinese work units -- whether they are government offices, factories or universities -- have rules forbidding unsanctioned contacts with foreigners, particularly foreign journalists.

Analysts are thus forced to turn elsewhere, searching speeches for subtle changes in formulation and looking for the appearances -- or absences -- of leaders at official functions, or cancellations of planned trips.

For example, the failure of Yao Yilin to show up at several important functions in recent weeks initially fed speculation that he would step down as executive vice premier. Yao, a member of the Politburo's six-person standing committee, the party's highest decision-making body, has since appeared in public, but because of poor health, his political star is likely to fall.

When the Foreign Ministry announced last month that the visit to Britain of Wan Li, chairman of the National People's Congress, had been indefinitely postponed for reasons of health, Chinese observers speculated that the real motivation was political. After not being seen for some time, Wan has returned to public view and was watched playing tennis at Beijing's International Club recently.

It now appears that Wan's trip was delayed because of his association with a Chinese painter, Fan Zeng, who fled to Paris shortly before Wan was to make his trip, and because Wan, a close associate of Deng's, was needed more at home, Chinese sources said.

It is particularly hard to find out what is happening these days, because there appears to be no genuine consensus even among Chinese leaders on a wide range of economic and political issues.

Until recently, it was not clear, for example, when a plenary Communist Party meeting would be held because of continued differences between party hard-liners and moderates. It now appears that it will begin on Dec. 25. Its main purpose is to approve the country's eighth five-year plan, which will outline the basic economic direction.

But the plan has become the battleground for those in the party who want more central control over the economy, and those, including many provincial leaders, who want to maintain a momentum for economic reform and oppose the recentralization of power in Beijing.

At a meeting with central authorities in September, provincial-level leaders, headed by Guangdong governor Ye Xuanping, objected so strongly to Beijing's proposals that the provinces hand back part of the authority granted them under the leadership of disgraced party chief Zhao Ziyang that the plan has been redrafted several times, and the plenary pushed back, according to Chinese sources.

It is unclear which side ultimately will dominate. But some Chinese observers say the reformers, for the moment, have gained the upper hand. The evidence, they say, is in the more moderate tone adopted by some top leaders, including party chief Jiang Zemin, in recent speeches.

Still, what can be gleaned from official newspapers is very little. Many Chinese, especially blue-collar workers, seldom bother to read the newspapers, especially the party organs such as People's Daily.

Lower-level government and party cadres and Chinese intellectuals say they feel they must at least glance at the newspapers to be current on the latest official line.

"We don't know what's really going on," one Chinese intellectual said. Referring to the current political climate, he said, "It's as if there are heavy storm clouds, but the rain cannot fall. . . . I don't think any of them {party leaders} have any kind of precise plan for the future. They are just trying to maintain the status quo and hope the sky doesn't fall in on them."