CHONGWE, ZAMBIA -- President Kenneth Kaunda was in a defiant mood as he defended his 27 years in office before a crowd of 5,000 Zambians at a political rally the other day in this dusty village, 90 miles east of Lusaka.

"My opponents say I have ruined the economy, that I am an old man who has lost touch," the 67-year-old Zambian leader barked with disdain, stabbing the sultry air with his finger. "These are lies. These are insults. My children, you must show these bad people. Show them the truth on election day."

As the citizens of this southern African nation prepare to go to the polls Thursday to take part in Zambia's first multi-party elections in nearly 20 years, Kaunda, one of Africa's most renowned figures since the independence era nearly three decades ago, finds himself in a fight for his political life.

His opponent is a political upstart named Frederick Chiluba, a fiery, articulate 48-year-old trade unionist who heads the Movement for Multi-Party Democracy, a new party founded last year after deadly food riots and an abortive military coup attempt persuaded Kaunda to give in to growing pressure for political pluralism.

While no reliable polls of voter preferences have been taken here, many Western analysts in Zambia believe that Kaunda is in serious trouble.

If the elections -- which are to be monitored by an international team of observers headed by former president Jimmy Carter -- are indeed free and fair, widespread discontent over authoritarian rule and economic mismanagement may result in the end of Kaunda's reign.

"He is in a real fight. There is a groundswell of sentiment here for change, change, change," said one diplomat. "My immediate response to 'who will win?' is that the Kaunda government will get wiped out." The diplomat, however, noted the difficulty of predicting an outcome "because there hasn't been a genuine election here in so long."

The Zambian polls are drawing widespread international attention not only for what they may say about this nation's future, but also as a barometer for the remarkable process of democratization sweeping many corners of Africa, a continent long burdened by single-party governments, unaccountable kleptocracies and harsh military rulers. Zambia occupies a key place near the forefront of this process, which, mirroring similar changes in Eastern Europe and the Soviet Union in recent times, began in earnest about two years ago with popular uprisings by Africans in many of the region's 40 countries clamoring for economic and political reforms.

In some of these countries, most notably Benin and Togo, reform has emerged by democratic consent of national conferences.

In others, such as Zaire, longtime rulers have attempted to retain their strangleholds on power by coopting opponents and controlling the pace of change themselves.

In still others, notably Kenya and Madagascar, autocrats continue to resist all notions of reform, despite simmering discontent and popular protest.

To his credit, Kaunda has made remarkable compromises with and accommodations to his opponents over the past 18 months in an effort to quell the restive Zambia population. For instance, he struck down the law that made Zambia a single-party state, finally agreeing to a national election open to anyone.

Indeed, in contrast to Kenya's Daniel arap Moi, Kaunda seems largely unafraid of opening the political system to new parties, ideas and leaders and fairly testing his popularity against theirs.

Chiluba's organization is by far the strongest of 16 new parties fighting to win the 150 legislative seats up for grabs and to oust Kaunda's United National Independence Party.

The election largely is a referendum on Kaunda's nearly three decades of leadership of one of the poorest nations in the world.

With a foreign debt of more than $7 billion, Zambia's nearly 8 million citizens suffer one of the highest per capita debts on the planet. The country is starved for foreign exchange, and its economic infrastructure, heavily reliant on earnings from copper and other minerals, has never recovered from the crash in world copper prices in the late 1970s.

More than one-third of the heavy equipment used in mining, transport and other vital industries in Zambia rests idle because of a lack of spare parts.

Zambia is Africa's most urbanized nation, with more than half of the population dwelling in towns and cities. And it is this hungry, restive and generally young population -- demanding jobs, better housing and affordable food -- that poses the greatest threat to Kaunda's rule.

"We shall offer a new generation of leaders, a new generation of attitudes, a new generation of ethical behavior in government for Zambia," Chiluba, a spellbinding speaker who has headed trade unions in Zambia for the past 15 years, recently proclaimed at a party rally near the northern city of Ndola.

Such words have struck a chord among many young Zambians pressing for better representation and accountability in a goverment long dominated by older figures, such as Kaunda, whose political roots stretch to a bygone era when the nation's biggest struggle was against colonialism rather than poverty and home-grown authoritarianism.

"Kaunda is a failure. . . . He has taken us to doom's destination," declared R.E. Banda, a 30-year-old teacher, as he stood with a circle of friends at a rally for Chiluba's party in Lusaka, the capital. "We have to prepare for the new generation before it's too late."

Kaunda "used to promise the people that we would become so rich we could eat an egg each day," said 19-year-old Peter Chipelo. "I can't afford to go to school anymore. And I haven't eaten one egg all this year."

Chiluba promises to liberalize the economy, cut the size of the government and guarantee rights of free expression and assembly, promises that strongly appeal to many Zambians long denied such freedoms.

He also frequently ridicules Kaunda's leadership and numerous unlikely development schemes that have failed under his reign, including one several years ago in which a foreign entrepreneur was given wide expanses of land in an ill-conceived experiment to make cooking oil and other fuels from Savanna grassweed.

The Weekly Post, a spunky new independent paper, recently uncovered a government plan to allow a Netherlands-based spiritual group, the Maharishi Heaven On Earth Corp., to acquire sizable tracks of land to develop meditation centers for Zambia's poor.

"Kaunda Backs Deal For Zambian Heaven," cried the headline.

While Kaunda played down the plan as merely an idea and pilot project in keeping with his political philosophy of peace and humanism, his critics are having a field day on the campaign trail. "We will not allow Zambia to be taken over by gurus from India!" declared Michael Mtesa, a leader of the Movement for Multi-Party Democracy, to cheers at a recent rally.

While the campaigns largely have been peaceful, many Zambians and Western observers are concerned by the growing rancor of the candidates' rhetoric, particularly from Kaunda, who has promised to "take care of" and "fix" his opponents and their supporters after the election.

Opposition party members have expressed concern about the fact that Zambia still operates under 27-year-old state of emergency laws that allow the president to arrest and detain citizens without charge.

For their part, Kaunda's supporters claim that Chiluba ran his Zambia Congress of Trade Unions like a private fiefdom and has his own streak of demagoguery.

These critics charge Chiluba and his supporters with insulting behavior toward the president, including name-calling and public aspersions about his sanity.

"It is African tradition to consider their presidents like father figures. These insults, this disrespectful behavior -- it is a different culture than we are used to," said John M. Simbotwe, a ruling party official.

Grey Zulu, a former vice president of Zambia and current head of the ruling party, agreed, charging that the multi-party campaigns constitute a "foreign culture" that has been imposed from the outside largely at the insistence of Western powers who have tied badly needed economic aid to democratic reforms here.

In essence, after decades of dull, uneventful and largely uncontested polls under the single-party state, both sides may be discovering that multi-party electioneering often is not a pretty process.

Pressed to defend his record, the gray-haired Kaunda has been forced to speak to his people and campaign like he never has before, traveling recently to seven cities in seven days aboard his presidential helicopter.

Yet compared to the energetic and free-spirited opposition rallies, Kaunda's rallies often have a staged quality, with crowds of faithful bused from site to site to observe the Zambian leader paying his respects to village chieftains, applauding performances by traditional dancers and railing against his opponents as "anarchists" bent on the nation's destruction.

Here in the village of Chongwe, Kaunda, the nation's biggest chief, accepted gifts of groundnuts and live goats and chickens from his subjects. Then he took to the microphone and reminded them of all he has done for Zambia over the years.

"Peace, unity, love. One Zambia, one nation. That is what I believe and that is what we have," he said, his trademark white handkerchief clutched in his left fist. "Look around Africa, what do you see? Starvation. War. Chaos. Look at our poor brothers in Zaire, Angola, Mozambique, Ethiopia, Uganda. . . .

"Zambia is at peace," he said of his greatest legacy, "not in pieces."

For now, Zambia -- even without a change in leadership -- appears to be a far different and more exciting place than it was before setting out on the rocky road to democracy barely 18 months ago.

"In my life, I have never been more proud to be a Zambian than I am now," said Derrick C. Chitala, a top official in Chiluba's party. "We are leading the forces for change."

"It's like a carnival atmosphere. Everywhere in Zambia people eat, drink and sleep politics," said Robinson M. Makayi, editor of the Weekly Post. "I can't see us ever going back."