College officials regard the race-based scholarships that have been challenged by the Bush administration in recent weeks as a critical tool in competing for the most talented minority students, making them feel welcome at predominantly white campuses and preventing them from dropping out.

The University of Maryland at College Park, for example, says that the full academic scholarships awarded this year to 121 high-achieving black students send a wider message about the college's interest in enrolling minority students.

Freshman students on the Benjamin Banneker scholarships scored slightly higher on the SAT, 1120, than the average College Park freshman and much higher than the average black student nationwide.

"As a recruiting device, it's wonderful," said Linda Clement, the university's director of undergraduate admissions.

"The message is College Park values their presence and respects their accomplishments. . . . It makes College Park an attractive place."

Sending a signal that a campus is hospitable to minority students is not regarded simply as a marketing device. It is a message that many higher education leaders believe could prevent minority students from dropping out because they feel alienated and isolated.

"I think that's powerful stuff," said Robert H. Atwell, president of the American Council on Education. "So many times we've been told minority students find predominantly white campuses chilly places."

Some college officials also maintain these designated scholarships have increased their minority enrollments, but there is no evidence of such a result on the national level. Several studies have shown black and Hispanic enrollments in college have either declined or remained stagnant throughout most of the 1980s.

"I think what we've got to say is the problem would be a heck of a lot worse if it were not for these programs," said Atwell, whose organization represents 1,600 colleges. "While there are a lot of {minority scholarship} programs, the total number of people affected by them is not large."

Most minority students who receive grants from colleges get them based on financial need. There is no definitive national count of the "race exclusive" scholarships that have been criticized as discriminatory by Michael L. Williams, the Education Department's assistant secretary for civil rights.

Last week, the department ruled that such scholarships created by earmarked gifts would be allowed and those with other funding sources could continue for four years, unless they become the subject of specific complaints. Those rules apply only to colleges receiving federal funds, but not to those under desegregation orders or private organizations such as the United Negro College Fund that sponsor scholarships.

The data that best describe the possible scope of the scholarships come from the College Board, which found in a survey this year that 34 percent of the nation's 3,138 accredited colleges consider a student's "minority status" in awarding some scholarships. The survey did not ask whether belonging to a racial minority was the predominant factor in any scholarships, a condition that would make them racially exclusive.

Another survey this year showed that 10 states appear to have established -- usually by legislation -- scholarship programs designated for minorities. They are Florida, Iowa, Kansas, Michigan, Minnesota, New York, North Carolina, Tennessee, Texas and Wisconsin, according to the National Association of State Scholarship and Grant Programs.

State colleges elsewhere, including the University of California system, have created minority scholarships out of appropriated funds without a specific legislative mandate.

Williams last week suggested, and a department spokesman later confirmed, that he believes any such use of state funds is unconstitutional based on Supreme Court decisions concerning racial set-asides in a state university's admissions and in contracts awarded by the city of Richmond.

Jerry S. Davis, co-author of the state survey, predicted federal enforcement of that legal interpretation could spark a conflict over a state's power to spend the tax dollars it raises.

"You can just imagine the federal government telling the state they can't do this with their money. I just don't think that'll work, politically," Davis said.

Wisconsin has one of the largest minority scholarship programs identified in the state survey. Nathan Peters, a budget analyst for the University of Wisconsin system, said that $2.2 million has been awarded this year to 1,300 students who are black, Hispanic, Native American or Southeast Asian.

Peters said the largest grant program, begun in 1986, was designed to increase the retention of minority students enrolled on the system's 14 campuses. The idea was to reduce the potential for financial problems that might cause students to withdraw. The average grant was $1,350.

"It's primarily there to replace loans and unmet {financial} need," Peters said. "Our last annual survey indicated 80 percent of the people who have received one of these grants either graduated or were still in school."

At the University of California system, the nation's largest, financial aid director Marilyn Jaeger said that in 1988-89 less than 5 percent of $104 million in financial aid was restricted by race.

Jaeger said the minority scholarships were intended to move toward making the system's enrollment reflect the state's racially diverse population. There are some "endowed scholarships" -- including one for Armenian Americans and another for white students from Hawaii -- but most of the minority scholarships are state funded, she said.

One of the oldest minority scholarship programs in the country is run by the National Merit Scholarship Corp. in Evanston, Ill. Since 1964, the private organization has run the National Achievement Scholarship Program for Outstanding Negro Students. This year, 52 colleges have participated as sponsors, awarding $1 million to 237 black students that they selected from a pool scoring high on the merit test, according to Ruth Lytle, a national merit spokeswoman.

American University recently joined the National Achievement Scholarship Program, according to Robin Robinson, the school's financial aid director. For more than a decade, the college has also offered Frederick Douglass scholarships to minority students and District residents, based on need. But Robinson said the Douglass scholarships have not been exclusive because several white District residents have received them as well.

Despite continuing uncertainty about federal policy on the scholarship issue, Robinson and other college officials contacted around the country appeared to be following the advice emanating from One Dupont Circle, where the American Council on Education and other higher education groups have offices.

"I'm telling them to sit tight," said Ed Elmendorf, vice president of the American Association of State Colleges and Universities.

"At this point," Robinson said, "I'm pretty much taking the position that I'm just not going to worry about it.