ATWOOD'S AMAZING `GRACE' : FAMED MURDER CASE REVISITED.

Byline: Mel Gussow The New York Times

When Margaret Atwood was in Zurich several years ago on a book-promotion tour, she had a sudden, inexplicable visitation. Looking out a window of her hotel, she thought about Grace Marks, who in 1843 at age 16 had been convicted of murdering her employer and his mistress. This was one of Canada's most famous criminal cases. For the author it had become something of an obsession, and in 1974 she had written a television play about Grace, based on the premise that she was guilty.

Now she had an image of Grace in the cellar of the Canadian farmhouse that was the scene of the killings. Inspired, she sat down and began writing a novel on the hotel stationery. Almost immediately, she found herself in a cul de sac and had serious doubts about continuing.

``I'm not Mr. Trollope,'' she said during a recent visit to New York City. ``Nothing is predictable in my work. There is no grand scheme.''

The problem, she realized, was that she was writing the book in the third person, and it was ``the wrong gear.'' Switching to the first person, Grace herself, she broke through into the story. Eventually the novel, ``Alias Grace,'' moved among several voices, including an American doctor who uses pre-Freudian analysis to explore Grace's emotional state at the time of the murders.

This is Atwood's ninth novel and her first work of historical fiction (unless her futuristic dystopian novel, ``The Handmaid's Tale,'' could be considered in that category). With the newly published ``Alias Grace'' (Nan A. Talese/Doubleday), she scrupulously holds to the facts as she discovered them in her research, and then, with a novelist's eye, she imagines dazzling twists and turns.

Although she was careful to avoid anachronisms, she does not think of it as a 19th-century novel: ``It was Robertson Davies who said that we can't help but be contemporary, no matter when we set our books.''

``Alias Grace'' was a finalist for the Booker Prize, the third time the author was so honored. When she and Beryl Bainbridge lost to Graham Swift, she told Bainbridge: ``He won the prize. You have the oeuvre.'' The same thing, of course, could be said about Atwood.

Though most of her work is rooted in the Canadian landscape, it is the opposite of insular. With dry, ironic wit, a poetic sensibility and more than a hint of the Gothic, she uncompromisingly has observed the psychology of the people in her society. Books such as ``Surfacing,'' ``Cat's Eye'' and ``The Robber Bride'' are not easily identifiable by the gender of the author.

Her female characters are victims and victimizers; some are the essence of evil, such as Zenia in ``The Robber Bride.'' And what about Grace? Innocent on the outside, she may have disguised a bitterly vengeful streak. In her prismatic novel Atwood refuses to say whether Grace was guilty but artfully considers diverse possibilities, including the notion that she may have been playacting.

The title ``Alias Grace'' refers to the fact that at one point the protagonist assumes the character of her best friend. The idea of alternate personalities pervades Atwood's work and her life. She was named Margaret after her mother, but, to avoid confusion, always has been called Peggy, which she thinks of as a frivolous name.

``I have a frivolous side,'' she admitted. ``But you notice which name I used for writing. In a way I had an alternate personality in reserve.'' For a time, she thought about using her initials M.A. Atwood as her writing name. (The copyrights to her books are in the name O.W Toad, an anagram of Atwood.)

Her father was an entymologist and would take his family on annual trips to the wilds of Canada's bush country, which furnished the author with her feeling for the more primal aspects of life, so endemic to her work. Before she was 6, she wrote poetry, then switched to painting. It was not until she was 16 that she wrote again.

She acknowledged the accuracy of a teacher's assessment (in a documentary about Atwood's life) that as a schoolgirl she showed ``no particular promise.'' But she never stopped reading. As she listed her girlhood favorites (``Grimm's Fairy Tales,'' ``Sherlock Holmes,'' Poe, Stevenson, comic books), they duplicated those of the average young boy, until she reached Jane Austen, her first strong female influence, and then she went on to Faulkner and Melville.

At 21 she began her career by printing 200 copies of her first book of poetry and selling them for 50 cents each. (That book now sells for as much as $1,800 at book fairs.) When she started, she said, there was no great tradition of Canadian writing, with few exceptions, such as Mavis Gallant, who left the country, and Davies. During one year in the early 1960s, ``only five Canadian novels were published,'' she said, and the country was considered ``a kind of hopeless cultural backwater.''

The atmosphere was even more hostile to male than to female writers. Writing was regarded as sissyish. ``Women did flower embroidering, interior decoration and poetry, woman-type things,'' Atwood said. ``If you found writers at all, and there was a small cultural community, there were good women writers among them.''

In contrast to the United States, ``I didn't feel all these genius men hanging over me,'' she said. ``Canada was a wide open prairie.'' It is now richly populated by Alice Munro, Michael Ondaatje, Carol Shields and Atwood, among many others.

The critic Northrop Frye was one of her mentors. And when he died, Atwood said that ``he did not lock literature into an ivory tower; instead he emphasized its centrality to the development of a civilized and humane society.''

She cherishes the fact that she has a wide international readership. ``If we only write books for people writing academic papers, it would be a futile exercise,'' she said.

Still, books and theses are continually being written about her work. She remains at a remove. ``Self-definition,'' she has said, ``is a kind of prison.''

In the absence of her own analysis, others have leaped to description. At various times she has been called Medusa-like, the Queen Bee of Canadian literature and a black-magic witch. Actually there is a witch in her family's closet, Mary Webster, who was condemned in Connecticut before the time of the Salem trials.

Atwood thinks that the journalistic name-calling has ceased as she has become older (she is now 57), but she is still nagged by the Medusa label. ``They wouldn't have been able to say that if I had been a snub-nosed blonde,'' she said. She has thick, brown curly hair and is petite rather than threatening.

She continues to draw the curtain on her private life. For many years she has lived in Toronto with Graeme Gibson, a novelist; they have a daughter who is in college. Steadfastly, she refuses to allow journalists to enter her house. ``They would review the furniture,'' she said, ``and some of it is Graeme's grandfather's furniture. I don't want my personality coming out like Graeme's grandfather.''

With hesitation, she spoke about her ability to assume other roles. She said that for years she and a friend staged puppet shows, in which she played many characters. Illustrating the range of puppet possibilities, she raised her voice to a falsetto, and said, ``You can be Little Red Ridinghood.'' Then a wicked smile crossed her face, as she lowered her voice to a growl, and said, ``And you can also be the wolf.'' She added, ``Why limit oneself to one voice?''

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Photo: The newly published ``Alias Grace'' is Margaret Atwood's ninth novel and her first work of historical fiction.

The New York Times