Undefeated Navy proved yesterday it can play with the big boys. The Milds' defense, No. 1 in the nation, reduced ponderous Pittsburgh to minus-28 yards rushing as the favored Panthers became Navy's seventh victim, 21-11.

"I lived with a group of guys for six years who refused to be defeated and this is the cloest I've come to that," Rear Adm. William P. Lawrence told the victorious Mids their locker room. He was referring to his six years as a prisoner of war in Vietnam.

Sixteen times Pitt ball carriers were thrown for losses, with rover Gregg Milo's four behind-the-line tackles leading the assault. Middle guard A. B. Miller, returning from an injury, was next with three.

So dominant was the Navy defense at the line of scrimmage that Pitt quarterback Rick Trocano threw 51 passes. He completed 25, for 275 yards, but at the key moments he was on his back, weighted down by Navy linemen.

"Our defense can play with anybody," said Coach George Welsh. "Pitt tried to run, but we stopped them outside. We shut down their option. There are no superstars out there, but we have 11 people who mesh very well. They're tough and physical and they don't have many breakdowns."

Bottled up in the first quarter, Navy did not make a first down and its offense amounted to nothing. Yet Pitt, in four excursions into Navy territory, was unable to score.

"When we can't get going," said quarterback Bob Leszczynski, "the defense stops them and gives us more confidence. With our defense, if we score 21 points, we'll be in every ball game."

Pitt's 11 points, of which eight came very late, were the most this season against a Navy team that has yield only 35 in its seven victories.

Gaining wind advantage at the start of the second quarter, Navy drove 68 yards in eight plays for a touchdown that put the Mids ahead to stay. The manner of its production indicated that Navy may be without its kidnaped mascot, but it is not without good fortune.

Tailback Steve Callahan cut through a hole at left tackle from seven yards out and, just as he reached the goal line, he lost the football. It bounded several yards into the end zone, where split end Phil McConkey fell on it for the touchdown.

"I thought he scored," McConkey said. "I thought the whistle blow. I just fell on it to be safe. It was really a hot-dog play on my part."

Twice on the scoring drive, Navy fumbles came after whistles stopped play. On one, Mike Sherlock seemingly lost the ball before he went down and Pitt's Jo Jo Heath recovered, to no result except frustration.

A fumble that counted put Navy in deep trouble. Leszczynski, fading to pass, was dumped by Ricky Jackson, with James Covert recovering for Pitt at the Navy 15.

Mark Schubert kicked a 28-yard field goal, Pitt's first success in three tries, after Gordon Jones dropped a third-down pass from Trocano in the right corner of the end zone.

With 32 seconds left in the half, John Merrill sacked Trocano, who fumbled, and Miller recovered at the Pitt nine. However, Jeff Pelusi made an end-zone interception of a Leszczynski pass and, to add injury to insult. Laszczynski received a painful below-the-belt blow as he released it.

"I was out of it," Leszczynski said. "I couldn't have played for 10 minutes or so. I'm lucky I was able to start the second half."

So, figuring to be deflated by that near miss and with its quarterback still shaky, Navy came out for the second half and blew the game opens.

On their first possession, the Mids drove 48 yards in eight plays following an into-the-wind Pitt punt. Larry Klawinski dove the last three yards for a 14-3 margin.

A key mistake by Pittsburgh on a third-and-one play at the Panther 39 kept the drive alive. Callahan was thrown for a four-yard loss, but Pitt was penalized 15 yards for defensive holding, a linebacker having tackled a Navy blocker.

On third and 10 at the 28, with Leszczynski as his only open-field blocker, Callahan swept right end for 16 yards. Then Leszczynski, on a second-and-nine keeper, pumped and ran, cutting inside two defenders to reach the three.

Navy benefited from a bobbled snap by Trocano to score its third touchdown. Steve Chambers pulled the ball away from Trocano at the Pitt 31 and Navy took it across in five days.

The touchdown was a four-yard pass, on third down, from Leszczynski to tight end Curt Gainer. Leszczynski fumbled the snap, grabbed the ball and threw with the blitzing Health hanging onto his jersery.

"I was supposed to roll out, but I fumbled the snap," Leszczynski said. "I looked for Carl (hendershot), who was the receiver, and he had 14 guys on him, so I was just getting ready to run and at the last second, I saw Gainer open. It was possibly the worst touchdown pass ever thrown."

But it looked just fine to the record crowd of 32,909, which realized that this Navy team was not about to dissipate a 21-3 lead. Pitt collected a fourth-quarter touchdown on Fred Jacob's two-yard dive to complete a 59-yard drive and then succeeded on a two-point conversion to produce an unusual statistic.

After each of the four touchdowns yielded by the Mids, the opposition has added two points. All the scores have come with Navy so far ahead that one point wasn't worth the kick.

A hero in a losing cause was Pitt linebacker Al Chesley, out of Washington's Eastern High. Chesley was credited with 15 tackles, five more than any other man on the field. And tight end Steve Gaustad grabbed 11 passes for 132 yards.

"Navy played 60 minutes of football and they did a great job with the athletes they've got," said Pitt Coach Jackie Sherrill. "This was a great win for Navy and they deserved it."

This is the first Navy team since 1960 to win its first seven games. The last club to win eight was the 1926 national champion. Next on the list is Notre Dame, Saturday at Cleveland, and Leszczynski said, "We'll go into that game with a lot of confidence, knowing we can do the job against a good team."