PHILADELPHIA -- 'Twas the week before Christmas and Santa Claus was driving around Medford, N.J., in a BMW. He stopped at a kindergarten, handed out gifts for a half hour or so and then drove on to a nearby diner.

He had rosy cheeks and a twinkle in his eyes, but he also had a swollen left knee that was killing him.

This was no everyday, department-store Santa. This one measured 6 feet 11, weighed about 275 and had hands the size of country hams. He turned heads on the streets, excited the kindergarten kids and created a stir among the waitresses when he walked toward the diner.

"Hey, look who's coming here, girls. It's Santa. A big Santa."

"Hey, Santa. You got a bag of toys with you or are you just goofing off?"

Santa walked inside, laughed at the waitresses' playfulness, parked his considerable body across a bench made for two and let his legs spill over into the aisle. His red hat and white beard were off, and one could see his short-cropped brown hair and youthful face.

This wasn't really Santa, it turned out. Just a helper: Jeff Ruland, 29, former center for the Washington Bullets, former National Basketball Association all-star and, for five painful games last season, a Philadelphia 76er.

Even as he sat there in that diner booth, his left knee was aching, just as it did when he walked off the basketball court for the last time in Chicago last January.

Today, he is simply father to two daughters, Courtney, almost 4, and Whitney, 8 months, and husband to his college sweetheart, Maureen. They live in a nice house in Medford.

He is up at 7, every other morning, changing diapers and warming bottles. He drives Courtney to school and to dance classes and to gymnastics. He rides an exercise bike and lifts weights and looks now and then to see if there's any improvement with the knee. There never is. There's always that little bag of fluid over the top of the knee. It puffs up and the joint stiffens. It has been swollen for most of two years now. It aches constantly.

Even if the swelling goes down, the knee will continue to deteriorate. There is no cartilage in the knee, and it has developed a degenerative arthritic condition. It's a disease that normally develops in the joints of 50- and 60-year-olds, but 20 years of pounding brought it early. So Ruland rides the bike, hoping to stave off the cane or the wheelchair that could be in his future.

Meanwhile, he is preparing for a new future, which he hopes will be in television broadcasting. Already he has worked three NBA games for the Philadelphia-based regional cable outlet, Prism, as a color analyst. And he is investing in businesses in Arizona, so that when his knee demands that he move to a warm, dry climate, he will have something to move to.

There is no bitterness, no self-pity. He blames no one for his misfortune.

"If I could do it over," he says, "I wouldn't come back so early from my injuries. I look back now and it wasn't a smart thing to do. That definitely made a difference. I could still be playing."

After the third and last operation on his knee in November 1986, his surgeon told him he had a 50-50 chance to resume his career.

"I did everything he told me, and unfortunately it just didn't work out," Ruland says. "There was nothing I could do about it. I thought I had six or seven good years left in me, but . . ."

Ruland went to Philadelphia in summer 1986 in a controversial trade that sent the 76ers' Moses Malone and Terry Catledge and two first-round draft choices to the Washington Bullets for Ruland and Cliff Robinson. Ruland, who had an iron-man reputation in his first three years in the NBA because of his durability and work ethic, apparently had recovered from a string of injuries, the worst of which was in the left knee. He was declared fit by the 76ers' doctors.

"I had never worked so hard," Ruland says. "I was in the best shape of my life. I had reduced my body fat from 19 to 13 percent. My bad knee actually tested out stronger than the good one. But when I started playing, it began breaking down again."

If there is anything that hurts now more than the knee, it is the memory of those few games at the Spectrum in a 76ers uniform.

"You couldn't help but hear," he says. "The first time the Bullets came to town, there was this big fat guy in the front row with a sign that read:

Moses Always Great,

Ruland Always Hurt

"I couldn't blame the guy, because at the time it was true. But it hurt. I know what Moses could do. He's a great player and everything. But I could play him even up, and as far as being an all-round player, I considered myself a better player. I could do some other things.

"Nobody knows how hard I worked. Nobody has ever worked any harder than I did that summer {before training camp}. And then, for the people in the stands to say the things they did. They never realized that I wanted to play more than they wanted me to play. . . . The thing that bothers me more than anything was getting traded to a team like the Sixers, a team with so much talent, a chance to win a championship -- and to get to play only five games . . ."

Ruland has no contractual obligations to the 76ers, but he may scout for them later this season. He will be collecting $800,000 in deferred payments from the Bullets the next four years, and in the next two months, he will receive a $1.5 million, tax-free insurance settlement from Lloyd's of London because of the career-ending knee injury.

When Ruland, a second-round draft pick, joined the NBA in 1981, it was thought that he never would be more than a backup center. But he became a starter immediately and was an all-star selection two years. He had great energy, great work habits, great goals and a great talent that was still developing.

He still has the energy and the work habits, but the goals have been altered.

"I just want to be able to lead a normal life," he says, "be able to walk, play some golf, spend time with my family. I just don't want to have to walk with a cane, or be in a wheelchair."