The Washington Bullets almost squandered a nine-point lead in the final 65 seconds last night, but scored the last four points on two free throws by Don Collins and a layup by Frank Johnson, and beat the New York Knicks, 105-98, at Capital Centre.

It was the Bullets' fifth NBA victory in six games. They play at Dallas tonight (WDCA-TV-20 at 8:30).

A free throw by Rick Mahorn with 1:05 remaining gave the Bullets a 101-92 lead, but the Knicks' Marvin Webster, playing his best all-around game of the season, followed with an offensive rebound and dunk.

Mahorn was called for a traveling violation and Webster again scored after an offensive rebound. Mahorn then threw the ensuing inbounds pass right to New York's Vince Taylor, who scored to cut the advantage to 101-98 with 30 seconds remaining.

After two timeouts, Collins was fouled by Webster as he drove for a layup. He made both free throws, and after the Knicks failed to score on four shots on their next possession, Johnson scored on a fast break.

The Bullets had a big third quarter, outscoring the Knicks, 28-16, to take an 80-64 lead into the final period.

"We had control and it looked like we were going to win in a walk, but we got very careless and let them back in the game," said Washington Coach Gene Shue. "Except for the very end, I thought we played a fine game. I was very pleased with our offense and the defense was unreal."

Jeff Ruland led the Bullets with 23 points, 13 rebounds and five assists. Ballard had 22 points and stopped Bernard King on defense.

Mahorn had 12 rebounds and 14 points in 44 minutes and Collins had 21 points as the Bullets shot 55 percent for the game, equaling their best shooting game of the season.

The Knicks were led by Webster, who had 22 points and nine rebounds. He also blocked eight shots, a record for a Bullets opponent.

It was Ballard's defense on King that was the key. King entered the game shooting 51 percent and had a 19.6 scoring average. King scored only nine points last night and made four of 16 shots in 34 minutes.

The other Knicks forward, Truck Robinson, went zero for four and scored one point.

"I just tried to overplay him and deny him the ball," Ballard said of his defense on King. "You have to keep him from getting the ball in close. He wants to post up, but I made him take the outside shot. With Truck not scoring and Bernard taken out of the offense, it really put the pressure on the rest of the team."

Said Shue: "Greg played an incredible defensive game. He was letter-perfect and Rick (Mahorn) was sensational. He really went up strong for the ball."

The Bullets used a 7-0 spurt late in the third quarter to build a 78-62 lead. It looked then as if the Knicks no longer were in the game.

Ballard started the rally with a 20-foot jump shot. After the Knicks missed, Collins scored on a fast break on an assist from Johnson.

Ballard stole the ball from Louis Orr off his dribble, then, as he was falling down, threw a 20-foot pass around Sly Williams to Mahorn. He dunked the ball and was fouled by Trent Tucker.

Mahorn made the free throw and the Bullets had a 16-point lead.

The Knicks opened the fourth quarter with two baskets by Webster, who made 10 of 12 shots for the game, and a long jumper by Williams to cut the Bullets' lead to 80-70.

A crowd of 15,812 was at Capital Centre, but that figure included many who came to see the Thomas Hearns-Wilfred Benitez super welterweight championship fight.

Kevin Grevey, playing his second game since coming off the injured list, made two of three shots last night in 19 minutes as Collins' backup.