With an eerie indifference to the calendar, the people of Britain spent this ordinary August day as an ordinary August day, almost forgetting the paroxysm of grief that swept the nation on this date two years ago, when Princess Diana died in a high-speed auto accident in Paris.

At noon, the crowd outside London's Kensington Palace, Diana's last home, could be counted in the dozens, and a good proportion were journalists, as compared with the thousands who gathered there on the first anniversary a year ago. There were none of the memorial services, concerts or marches that marked last Aug. 31. Diana's old friend Elton John was moved to complain that "it is about time somebody did something to remember her."

The nation's most widely read daily paper, the Sun, tried to sum up the national mood in one of its characteristic one-word headlines: "Forgotten." While that is surely an overstatement, there is a sense here that ordinary Britons, the people who never hung out with Elton John or Diana's other glitzy pals, are more than ready to put her memory to rest.

Despite ambitious plans, a worldwide fund-raising drive and the creation of a Memorial Commission headed by none other than the chancellor of the exchequer, Britain's treasury secretary and chief budget official, no official Diana memorial has been created. The commission hasn't met in 10 months, and there is a growing sense that most Britons don't care all that much whether the proposed parks, playgrounds or statues it considered ever get built.

In a society that loves to analyze itself, numerous explanations have been set forth to explain the diminution of Diana madness. The news bulletin from Paris on Aug. 31, 1997, sparked a spontaneous outpouring of hundreds of thousands of people carrying flowers and handwritten messages to the lavish wrought-iron gates outside Kensington Palace, followed by a collective national period of mourning that culminated in Diana's funeral at Westminster Abbey one week later.

Two years ago, there were suggestions that the overwhelming rush of grief for Diana signified a new, more sentimental Britain, where the famous stiff upper lip was suddenly awash in public tears. Today, many seem to feel embarrassed about that collective burst of emotion. Public expression of sentiment once again tends to be frowned upon.

John Humphrys, a respected BBC anchorman, chastised the nation last week for the "great emotional outburst about Diana" in 1997. "It is the very transience of public emotion," Humphrys said, in remarks that have been widely repeated, "which marks its shallowness, its sentimental nature. . . . Sentimentality is even affecting our politics, encouraging politicians to appeal to our superficial emotions."

Meanwhile, many of the controversies that surrounded the ill-fated princess in life are still churning, making today's anniversary an occasion more for contention than contemplation.

The princess who was plagued throughout her adult life by friends seeking to trade on their association with her is once again being used as a meal ticket. Diana's younger brother, Charles, the 9th Earl Spencer, turned down his sister's request to live on the family estate after her divorce from Prince Charles. But now the earl has buried Diana on the estate and is doing a healthy business charging people $16 a head to pay tribute at the grave site and visit a museum displaying some of her more lavish jewels and gowns.

Harrods department store, owned by Mohammed Fayed, has again this year put up its ornate brass-and-floral memorial fountain honoring Diana and Fayed's son Dodi, who was in the chauffeured car with her when it crashed. For the first time, Fayed put on display the diamond ring that he insists his son had bought for Diana to mark their engagement. Harrods today also was selling an "exclusive" $135 scarf in a soft blue and gray plaid called the "Princess of Wales Memorial Tartan."

Then there's James Hewitt, the former army officer known to the London tabloids as the "Royal Rat" because of his kiss-and-tell book saying he had a love affair with Diana. He is working on a new book based on letters he received from Diana while she was still married to Prince Charles. Hewitt is reported to have received $800,000 from a tabloid newspaper for serial rights, and Diana's estate is said to be considering a lawsuit to prevent publication.

The royal family, meanwhile, is said to be wrapped in angry intra-palace arguments relating to Diana, her marriage and her legacy. Ever so gradually, Prince Charles has been letting the British public see more and more of his romance with Camilla Parker-Bowles, the notorious "other woman" whom Diana blamed for wrecking her marriage. But each time Charles and Camilla appear in public, the newspapers blossom with leaked stories reporting that Queen Elizabeth is furious with her son for consorting with a divorced woman who remains deeply unpopular with the public.

When Charles's youngest brother, Prince Edward, was wed this summer, Parker-Bowles was conspicuously absent from the invitation list. Last month, Charles borrowed a 440-foot yacht from a Greek friend to sail the Mediterranean with his sons, Princes William, 17, and Harry, 14. But he also invited Parker-Bowles along, sparking a major uproar in the press and another blast from his mother, if the tabloids are to be believed.

CAPTION: SUDDEN GRIEF: In the days following Diana's death, tens of thousands of people filed by her London residence to leave flowers and other mementos.

CAPTION: FADING MEMORY: Two years later, only a few hundred people stopped by her Kensington Place home to pay their respects.

CAPTION: DUAL TRIBUTE: Display at Harrods store honors Diana and Dodi Fayed, who died together.