MOSCOW, DEC. 30 -- The last empire on earth is facing what may be its ultimate confrontation. Mikhail Gorbachev, who began the year by allowing the liberation of Eastern Europe, is now drawing the line against the rebellion of the 15 Soviet republics, declaring his "immovable" insistence on the survival of the Soviet Union, his "unshakeable" faith in communist ideals.

But despite Gorbachev's threats to institute direct presidential rule in "ethnic hot spots," around the periphery of this vast country, there is an unmistakable sense that a barrier has fallen, that a state has been irrevocably transformed. Moscow will never again be the unchallenged center of power for 285 million people and more than 100 nationalities, the unquestioned master of everyone from the dockers of Riga to the trappers of the Kamchatka Peninsula.

"We are not naive. The Roman Empire did not fall in a day. But we are also sure that Moscow can no longer hold onto us through brute force. I don't think they have the will for that anymore," said Dinas Ivans, the 35-year-old deputy chairman of the Latvian legislature.

"Whether Gorbachev likes it or not, there is not a republic in the country that did not experience in 1990 a rebirth of national consciousness, a sense that independence is superior to dependence and that Moscow can no longer dictate our destinies," said Mohammed Salikh, chairman of Uzbekistan's Democratic Party and one of the founders of the Central Asian independence movement Birlik. "The idea that the old union can last as it was is as utopian as communism itself."

In the early years of Soviet leader Leonid Brezhnev's rule, the dissident Andrei Amalrik wrote a pamphlet with a title that smacked of sheer political fantasy: "Will the Soviet Union Survive Until 1984?" Amalrik dared to suggest that the vast empire ruled by the Soviet Communist Party was actually a web created and maintained through deportation, execution and propaganda. It could not survive indefinitely.

Amalrik, it turned out, was only slightly off in his predictions. By December 1986, with the first nationalist demonstrations in Soviet Kazakhstan, Kremlin leaders were suddenly forced to confront the same question posed in the underground essay two decades before. Each month brought new and sobering evidence of an empire in peril -- crowds in the hundreds of thousands demonstrating in the streets of Yerevan, Tbilisi and Baku, a human chain of protest across the breadth of Latvia, Lithuania and Estonia.

In 1990, nationalist consciousness was transformed from a range of popular movements to a central fact of political power. Leaders of popular-front groups took control of legislatures from the Baltic republics in the north to the Transcaucasus in the south. In an eight-month period this year, legislatures in every republic, beginning with Lithuania and ending with Kirghizia, declared their sovereignty or outright independence.

Even in Central Asia and other regions of the country that were once considered reliably obedient in the face of Kremlin power, the Stalinist fiction of a Soviet man and culture has been discarded. In its place has emerged the beginning of national understanding rooted not in a discredited ideology but in history. Lenin's demand for an "assimilation" of nations into a unified workers' state simply never happened.

The nationalist awakenings across the country accelerated this year with extraordinary speed.

Last New Year's Eve in the Lithuanian capital of Vilnius, the popular local television program "The Mirror" used a puppet show to mock Gorbachev's attempts to talk Lithuania out of seeking independence. In the show, a prancing Gorbachev tried to find a "solution" in the republic by siding with the republic's few remaining hard-line Communists. Suddenly, a Stalin puppet screamed at Gorbachev: "You idiot! There is no time for compromise! Just attack!"

Like his puppet likeness, Gorbachev first tried to talk. Supremely confident of his ability to persuade, Gorbachev went to Vilnius. For a long and frustrating weekend, he tried to cajole the Lithuanians, alternately showing signs of conciliation, disbelief and anger. The Lithuanians listened, but they did not back down.

On March 11, the new Lithuanian legislature declared the republic's independence. After the playing of the Lithuanian national anthem, the legislators cried out: "To a free Estonia! To a free Latvia!" Vytautas Landsbergis, a musicologist who became president of the legislature, raised his arms in triumph.

The next day, two workmen set a ladder against the legislature door, pried off the hammer and sickle and nailed on the Lithuanian seal of St. George. For a moment -- but not much more -- it all seemed so simple, so unreal. Was this how an empire crumbles?

By early summer, the stakes had multiplied, going way beyond the tiny Baltic states. Before leaving for a summit in Washington, Gorbachev tried to talk the newly elected legislature of the giant Russian republic -- by far the country's largest and most important -- out of making Boris Yeltsin its chairman and effective president. Gorbachev supported instead a couple of bland Communist Party apparatchiks.

Yeltsin's triumph marked the rise of a new kind of Russian nationalism -- not the xenophobic movement that so many here and in the West had feared, but rather a quest for decentralization, privatization and cultural renewal that has greatly expanded the boundaries of Gorbachev's own reform drive.

The Russians' declaration of sovereignty was the impetus for similar steps around the country. In mid-July, Ukrainian lawmakers declared their republic sovereign. Then came Kazakhstan, Uzbekistan and all the rest. The republics also infuriated Gorbachev by signing a series of "horizontal" economic treaties among themselves that bypassed Moscow.

Once the entire Soviet Union had joined the sovereignty parade, Gorbachev dropped earlier promises of making a "special case" of the Baltic republics. Negotiations on beginning independence talks with them suddenly broke down. "The only time we got called in for meetings with Moscow was just before Gorbachev was getting ready to go to the West. It was all a propaganda game," said Igor Gryazin, an Estonian member of the national legislature, or Supreme Soviet.

Instead, Gorbachev devised what he saw as a comprehensive compromise, a new Treaty of the Union to redefine the binding relationship between the republics and the central government. But his proposed treaty, which might have seemed a radical innovation a year or two ago, was now seen as a hollow ploy by nearly every republic in the union. Gorbachev, once the initiator of so many reforms, had reacted too late.

Although the treaty promises greater sovereignty for the republics, it would retain tremendous powers for "the center." The Baltics, Georgia, Moldavia and Armenia have already rejected the treaty, and the Ukraine and Russia are demanding radical revision.

The political stakes now are clear. Pressed by the KGB, the military and the Communist Party, Gorbachev has said repeatedly in recent weeks that he will do everything in his power to prevent the collapse of the union.

"Gorbachev, for all the liberalization that took place in Moscow in the first years of perestroika {Gorbachev's program of political and economic restructuring}, still sits at the top of the pyramid of power that rules an empire. He is protecting the interests not of the people that live in that empire but of power itself," said Bogdan Horyn, a former political prisoner who is now a key Ukrainian legislator.

Although the West has focused much of its attention on the peaceful political struggle in the Baltics, the face of nationalism -- of the battle between the republics and Moscow -- in much of the rest of the country is growing ever more complicated and dangerous.

There is an ugly side to the battle. Every week brings reports of deaths in such places as Baku, Stepanakert, Osh, Fergana, Tuva. A police officer is hanged by an angry crowd in Moldavia. A Supreme Soviet member is kidnapped at an airport in Nagorno-Karabakh. The self-proclaimed democrats of Georgia suddenly declare the autonomous region of South Ossetia their own. The number of internal refugees soars past a half-million. Minority populations in some regions fear that the new governments of their republics will put nationalism before democracy.

"We are finding ourselves becoming a vast country of Lebanons and Yugoslavias," said Giorgi Shakhnazarov, one of Gorbachev's closest advisers.

The politics of nationalism has also broken down into ever smaller units. Now, not only the republics, but ethnic minority groups within them -- the Gagauz of Moldavia, the Tatars of Russia -- are asserting their sovereignty, causing some observers to wonder where the process will stop.

"I'm all for as much decentralization as we can stand, but it starts to get ridiculous when every little region and hamlet wants to be sovereign," said Stanislav Shatalin, who until recently was one of Gorbachev's two closest economic advisers. "It's getting to the point where sooner or later someone is going to declare his apartment an independent state."

Some republics have turned their political attention so deeply inward that they pretend at times that the power of Moscow no longer touches them. They send "observers" to sessions of the national legislature. Armenian journalist Alexander Iskandarian said his republic's legislature "has become almost completely 'Armenian-centric.' It's as if they are rehearsing for real independence. There is something naive and dangerous about ignoring the world around you."

To a great extent, the key political battle over the future of the republics will focus on Yeltsin and Gorbachev. Their differences are far more profound than a simple clash of personalities. The Russian legislature has infuriated Gorbachev by cutting its contribution to the Soviet budget by about 119 billion rubles -- nearly half the country's proposed expenditure. If the rest of the republics make similar cuts, Gorbachev said, the result "would be a collapse not only of the economy but of the union."

The period of euphoric declarations is now long over. March in Vilnius seems like a decade ago. The Soviet Union, as an empire, as a government, has reached the point of paralysis and confrontation. Gorbachev says order must be restored to move ahead with reform. The republics suspect that "order," in the Kremlin's terms, is merely another word for the preservation of the current centralization of power.

Gorbachev may turn out, after so many triumphs, to be a reformer who has reached his limits, an unelected leader who looks out at his options and sees only the KGB, the Communist Party and the military there to support him. The sense of confrontation in the country is so acute that in the Baltic republics there are now classes on civil disobedience, in the south there is Quixotic talk of armed confrontation. The coming year begins with no answer in sight.

"But there are no forces that will ultimately be able to hold back the fall of the empire," insisted Bogdan Horyn, of the Ukraine, echoing other nationalist leaders. "This has become an inevitable process at this point. The question is: Does change come peacefully, gradually, politically, or does it end in blood?"