RIGA, U.S.S.R., DEC. 20 -- In the offices of the Latvian newspaper Diena, the young assistant was monitoring the hourly radio bulletins from the Congress of People's Deputies in Moscow. Slowly, the color drained from his face. "Shevardnadze's out," he said taking off his headphones. "What's going to happen now?"

Eduard Shevardnadze's resignation today as foreign minister and his dark warning of a return to dictatorial power in Moscow was like a warning shot here to legislators and ordinary people who for weeks have listened as the heads of the KGB secret police and the armed forces seemed to be gaining the upper hand in Mikhail Gorbachev's government. Fears of direct presidential rule or even martial law in the Baltic states deepened dramatically.

Mavrik Volfson, a deputy in both the national and Latvian legislatures, flew back from Moscow to give his colleagues the ominous news.

"I know Shevardnadze quite well, and he is telling us, all of us, that we must be alarmed, that the reformers are in danger of losing the political battle," Volfson said. "In his soul, perhaps, Gorbachev stands with Shevardnadze. But now, with the economy in collapse, Gorbachev is looking to the army as the most organized national force left in the country. If he continues to listen to the army and not to Shevardnadze and his own soul, we all will lose."

Dainas Ivans, deputy chairman of the Latvian Supreme Soviet, said that with Shevardnadze's resignation and Interior Minister Vadim Bakatin's dismissal last month, "the Baltic states lost the two people in the Kremlin who were willing to listen and compromise. Gorbachev is taking a much more hard-line position and now there is no one left to temper that line."

Legislators here said that if Gorbachev tries to dissolve the assembly and introduce direct presidential rule, the Baltic states would be prepared to use a strategy of peaceful resistance, refusing to cooperate with Moscow's orders and representatives.

"We will take the road of Mahatma Gandhi, the road of civil disobedience," Latvian Deputy Foreign Minister Sandra Kalniete said. "The Baltic leaders have been talking about this possibility every day for quite some time."

Officials here said they feared that the West, particularly the United States, was not prepared to change its view of Gorbachev "until perhaps it is too late," Kalniete said.

"We still have fresh and painful memories of how Washington reacted to the slaughter on Tiananmen Square," she said. "They hesitated, they reacted out of a mistaken sense of political interests. These are tense and dangerous times. If there is a crackdown, there are many of us who would simply be destroyed. We might not be killed, but we would die a little inside."

Volfson said Shevardnadze had grown weary of the military's constant criticism, public and private, of the country's foreign policy.

"With the withdrawal from Eastern Europe, with the end of empire and the unification of Germany, the military gritted its teeth and accepted what it was ordered to do," Volfson said. "But now that the army is feeling its influence, it has gone after Shevardnadze tooth and nail."

"I met with him for three hours and he told us that Moscow simply could not allow the Baltic states to participate as observers at the European summit in Paris because the army would not accept it. Now Shevardnadze is sending us an even more troubling warning."

Sarmite Elerte, an editor at the newspaper Diena said, "Gorbachev has always moved back and forth but he has never moved this far to the right. We can only hope that he will hesitate before declaring presidential law in the Baltics. World opinion must stand in his way. Gorbachev has to know that he just cannot rein in all the forces he's already set loose."

In recent weeks, KGB chief Vladimir Kryuchkov and Defense Minister Marshal Dmitri Yazov have appeared on television warning that they are prepared to take "all necessary measures" to put an end to resistance to Kremlin control in the republics. For Latvians especially, the appointment of the republic's former KGB chief Boris Pugo as the head of Soviet law and order was "a chilling signal."

"Pugo is a diehard Communist, one of those officials who would do anything to retain the old structure," Latvian Foreign Minister Janis Jurkans said. "As a former high-ranking official in the KGB, one of the bloodiest organizations in the history of the modern world, Pugo will dig in his heels. By contrast, Bakatin was a human, flexible figure, and those are qualities I do not think you are going to see from the new regime."

Of the three Baltic republics, Latvia is perhaps the most strategically important for Moscow. The republic is the base for the Baltic fleet, the regional military command, the KGB border guards and the regional air force. In the last two weeks, Latvian leaders said, they have been especially fearful that the army would try to provoke unrest and use it as a pretense for a crackdown on independence movements.