Considering it's a place where many people go expecting to lose money, there are an awful lot of smiling faces at Freestate Raceway these days.

"Ever since Mr. DeFrancis took over, it's been a lot better here. It's nice to just to come out and sit," said one bettor in the grandstand. "It used to be a dump."

No more. In 1980, Frank DeFrancis bought the 37-year-old harness track from the National Bank of Washington, which had foreclosed on the previous owner. The purchase price of the track and an adjoining 18 acres was $6 million, and it came with the aid of a $1.6 million interest-free loan from National Bank.

The changes, both physical and fiscal, have been dramatic. Physically, they can be seen in the 100-year-old oak lumber used in the renovation of the grandstand, teller cages that came from The Bowery banks in Philadelphia and New York, terrazzo floors and crystal chandeliers in the women's rest rooms. Workers pick up trash during the racing program. "The ambiance created in the facility is unique," DeFrancis said.

Take the hot dog stands.

"You can build hot dog stands for $12,500," DeFrancis said. "But mine cost $125,000 each . . . Freestate's patrons are treated to creature comforts and employe courtesy that, I think, are second to none."

John Rest of Ellicott City is one of those patrons. He says he has been playing the horses for 16 years. "I used to come when they had the old dirt track and then the Tartan track . . . But these people got a real interest in the track. They try to have good races. They have class races, especially on weekends. And they're good to the public, giving out passes where you can get in for half-price. People appreciate that."

Through Thursday, which was the 79th of 115 dates at this year's meeting, Freestate has had 448,229 fans pass through the turnstiles, for an average of 5,673. That was an increase of slightly more than 9 percent over the same period in 1984. The track has had a total handle of $48,394,144, for a $612,584 average -- an increase of more than 8 percent from 1984.

"And last year," said Ross Klavans, Freestate's public relations director, "we led all U.S. race tracks -- thoroughbred and harness -- in increases in attendance and handle. This year, the numbers are already ahead of that pace."

DeFrancis is proud of what he has accomplished. "For me, it isn't really work," he said. "because it's something I truly love."

DeFrancis said his love for horses began when he was 10, on a day when the fish weren't biting and he talked his father into taking him to a track. Now, he owns Freestate, Laurel Race Course and thoroughbred and standardbred horses.

DeFrancis said he had been to Freestate, which was then called Laurel Raceway, no more than half a dozen times before he bought it. He said he really never had looked at it.

"My first reaction was, 'Oh, my God,' " DeFrancis said. "But the reason you buy absolutely any piece of real estate is location, location, location. It's in the Washington-Baltimore corridor and, for people 35 and under, this is the highest per capita income market in the country. That's a dynamic group."

DeFrancis has picked up ideas from most of the world's race tracks in his campaign to bring in more fans, have them enjoy themselves while they are at the track, and then have them return with a friend.

"It's the kind of thing where you say, 'If I were king, I would do this and do that,' " DeFrancis said. "When I acquired Freestate, I said I wanted to concentrate on three things: one is fan comfort, two is caring employes and three is the track itself. And I take great pride in saying that Freestate is the finest five-eighths-of-a-mile track in the country, and it's not because I say so, but because the drivers and horsemen say so."

Indeed they do.

Tom Beaver is from Centerville, Md., and has been coming to the track for 12 years as an owner, trainer and driver.

"Mr. DeFrancis has changed things to make it so everybody enjoys themselves when they come to the races," Beaver said recently while getting his horse ready for a race. "The purse structure is so much better now. Better horses and more money. We're going for fantastically good money here. Besides the Meadowlands, this is the next-best place to race."

The limestone track is kept groomed during the day for workouts, there is a drivers' lounge and the backstretch kitchen stays open late. All of that translates into an enjoyable place for horsemen to bring their charges. And, after all, it's the horses people come to see.

"They just try to make it better here," said driver Doug Hie, who originally is from Peterborough, Ontario, and is in his first summer at Freestate.

"Everyone here works hard," DeFrancis said. "And everyone here -- from the fans, to the employes to the horsemen -- know that I work hard to make this the best harness track in America."