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Ah, OAKLAND . . . home of the Hell's Angels and the Black Panthers, Isadora Duncan and Jack London, the Kaiser Corporation and Clorox, and the largest container port on the West Coast. This city has character, diversity . . . and a bad image.

In unflattering juxtaposition with that urban jewel across the bay, San Francisco, it rarely escapes unfair comparison - that is, if it's compared at all. Neighborhoods where quaint old buildings house diverse populations are called ''charming'' in San Francisco. In Oakland, similar areas are ''run-down.''

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Even when Gertrude Stein tried to say something nice about her hometown it backfired. ''There is no there there'' - a comment, taken out of context, about the changes in her girlhood neighborhood - has become an often-used putdown of a place she was fond of.

With a large black population and inner-city economic decay, combined with its position as the mainland terminus of transcontinental trucking and rail systems and Pacific Ocean trade, Oakland has been disparagingly called ''San Francisco's service entrance.'' The outside image bears only a distorted resemblance to the real character of this city, which has plenty of claims to distinction, if not uniqueness.

Oakland is the most integrated American city by several measures. Its leadership has been inherited by blacks who hold a larger proportion of the power base than members of their race in any other major US city. Under their leadership, with the aid of the corporate community's money and influence, a social and economic renaissance is slowly reversing Oakland's long post-World War II slide. Although it still has economic problems, Oakland could be a sociopolitical model for many cities struggling to accommodate diverse interests that are often at odds.

The difference between Oakland and virtually every other American city with a black mayor and a large black population is that Oakland is truly integrated. It is 47 percent black, 38 percent white, 10 percent Hispanic, and 8 percent Asian - but no single neighborhood is exclusively black or white. (US Census Bureau counts some people in two groups, which makes total over 100 percent.)

Oakland's black mayor, Lionel Wilson, is just one of many minority members holding key positions in the city. The City Council includes four blacks, an Asian, and three whites; the seven-member school board has four blacks. black Rep. Ron Dellums (D) has maintained his Eighth District (northern Alameda County) seat in the US House for 14 years.

Cora and Rod Marshall describe their well-kept working-class East Oakland neighborhood as a ''black'' area. But neighbors next door and across the street happen to be white. Similarly, up in the pricier Montclair section of the Oakland hills, civil engineer Peter Van Maren's young family lives in a ''white'' neighborhood. There just happen to be black families living there, too.

And Jose Arce, an executive with the Spanish Speaking Unity Council, lives on China Hill, which is an ''Asian'' neighborhood. Mr. Arce, of course, is not Asian but Hispanic.

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Oakland's 332,000 residents are as visibly integrated on the neighborhood streets as in the statistics compiled by Karl Taeuber, a sociologist at the University of Wisconsin Center for Demography and Ecology. Only 2 percent of all Oakland blacks live in all-black blocks, and only 7 percent of nonblacks live on blocks of solely nonblack residents, according to Dr. Taeuber. His detailed study of 1980 Census figures in 28 cities with more than 100,000 black residents showed Oakland to be the ''least-segregated city'' in the US. On a scale of 0 to 100 (the higher the number, the more segregated), Oakland was the lowest at 59. Chicago, the most segregated city, rated 92 on the scale. Gary, Ind., was the nearest Oakland with a score of 68. Although the residential pattern was the major one, other factors were considered in the rating.

''It's remarkable to have this,'' says Dr. Taeuber. ''The political climate allows this here. There aren't the rigid ethnic neighborhoods here in the pattern of the old industrial era'' that still exist in the East, he explains.

Residents don't claim there is no discrimination in Oakland. What is remarkable about their comments, though, is that they reflect a basic belief that Oakland is integrated and free of racial strife.

''This is the least racially uptight community I've seen in America,'' asserts Robert Maynard, editor and publisher of the Oakland Tribune. The first black owner of a metropolitan daily, Mr. Maynard's comparison of Oakland to other cities is based on knowledge garnered during a five-year period during which he traveled around the United States reporting on urban affairs for the Washington Post.

He describes the gala ball and opening-night concert of the Oakland Symphony as an example of the city's integration. ''When you go to the Symphony Ball here , it's not an all-white occasion,'' he says of what in the US is often characterized as the epitome of a white upper-class social event. Moreover, the symphony was led by Calvin Simmons, a black who prior to his death in 1982 was considered one of the nation's most promising young conductors.

Rod Marshall, too, has seen the difference. After experiencing police harassment on a visit to Louisiana as a teen-ager, and later ''feeling'' segregated at his private black college in Dallas, he says in earnest, ''I never felt those things in Oakland.''

Mr. Marshall, a courier by day who is building a financial-planning business by night, is raising his two daughters in the same neighborhood in which he grew up. He and Mrs. Marshall, a senior operations administrator at Wells Fargo bank, feel comfortable that their ambitions to get a bigger house and keep their children in good private schools can be satisfied in Oakland, where they feel no restrictions.

Michael Belknap, a white factory worker, says he and his wife, a schoolteacher, chose Oakland because the weather is decidedly more sunny here than some other spots in the San Francisco Bay Area. But he also says the city is desirable because ''it's not uptight.'' Both the Belknaps grew up in the Bay Area, and they recently returned after living for a few years in Greeley, Colo. ''We wanted to live in an integrated area, but we didn't want to be the people doing the integrating,'' explains Mr. Belknap. One of the reasons they returned, he says is that they wanted their children ''to see different cultures and have an ability to recognize people as people rather than members of a particular group.''

Even with a social climate that accommodates all races, the city has its share of problems. One of every five residents has an income below poverty level , unemployment among youth is near 50 percent, drug trafficking and crime rates are high. These social ills generally go together, and many Oakland community leaders feel the way to alleviate them is to rebuild the local economy.

The downtown area is the focus of an intense campaign to create a business center that can compete with congested and expensive San Francisco. Richard Spees, an executive with the multifaceted Kaiser Corporation who also is an Oakland city councilman, is one of Oakland's staunchest promoters. He counters the city's longtime second-rate image with a laundry list of desirable characteristics.

The city, says Mr. Spees, is the geographic center of the Bay Area's 5 million population. It has the best climate on the bay, he asserts, and cheaper office and home prices than San Francisco. Oakland's transportation system includes a completed freeway system and several BART (Bay Area Mass Transit) stations.

And, notes Spees, Oakland has locally based teams in every professional sport. (Although die-hard Raiders fans, wounded by the professional football team's move to Los Angeles, do not embrace the United States Football League's Oakland Invaders.)

Councilman Spees and others point to the $95 million Hyatt Hotel and convention center as the centerpiece in the downtown redevelopment plan. But that modern, 20-story giant sits alone today in sharp contrast to yawning vacant lots nearby that await the political and financial momentum to complete ambitious redevelopment plans.

Those who administer the vast Oakland port had the foresight to build facilities to handle ''containerized'' cargo - today's state of the art in shipping. The port has been an economic mainstay here. Kaiser and Clorox - major employers, too - have been influential. Indeed, the black community developed here because of the jobs Kaiser metals created in shipbuilding and auto manufacturing before and during World War II.

But it is generally agreed that Oakland needs more business to revive its economy. Balancing the change business brings and the unique social setting in Oakland is a challenge being tackled by all facets of the community. Mayor Wilson, who grew up in Oakland, remembers learning to swim in the Oakland estuary because blacks weren't permitted in public swimming pools.

The mayor is identified as pro-business because his priority is to develop business in order to create a tax base that can bolster underfunded social services. It's a priority that has won him what he calls the hard-fought trust of the corporate giants like Kaiser and Clorox, but has not always won the mayor popularity among his minority constituents.

Ironically, the mayor owes his 1977 election success to the radical Black Panthers, credited with the organizational foundations of the minority community here. Before the Panthers movement in the 1970s there had never been a Democrat, let alone a liberal black, on the Oakland City Council.

''Some of my strongest supporters now are those who opposed me (in his 1977 bid for mayor),'' Wilson says. Criticized for being too strongly business oriented, he says, ''That's a question from minorities who expected me to turn the keys of the city over to them.''

Wilson talks about the ''balance'' he hopes to maintain in a community of such diversity. He makes it clear that business development isn't the only way to provide help to the community. He points to a senior citizens housing project he helped push and complete, despite protests from federal housing officials who didn't want to invest in the project if it was to be located in the blighted neighborhood in which it now successfully operates.

But ultimately, the mayor says, ''the only way to provide the city with its basic needs and services is to do it with a strong economic base. Some people see those tall buildings and say they're satisfying the business community. I see them providing services to people,'' he explains.

Mayor Wilson admits some segments of the community are impatient with his ambitious downtown redevelopment plan. In many neighborhoods where drug abuse and crime rates seem to move upward with unemployment, his constituents are anxious to see the jobs and social services the mayor has promised will flow from new businesses downtown.The mayor says it takes time - years, not months - for the economic effects of new business to filter through the community and that the whole plan must be in operation before benefits can be reaped.

So far, only the centerpiece of the mayor's downtown redevelopment has been completed - the Hyatt Hotel and convention center. Some minority groups have complained that they haven't seen an increase in jobs. One of the major controversies here has focused on hiring quotas and equity programs that would require minority involvement in financing and employment in new businesses taking advantage of redevelopment loans provided by the city. Minorities want more of a stake in redevelopment to ensure they won't be pushed out of the community. Business interests, meanwhile, want fewer of these programs, which they claim are so restrictive as to make it less financially feasible to locate here.

Minority involvement in community affairs is no longer questioned, locals say. The question is, what will the influence of the minorities mean for Oakland?

''There has been a lot of dialogue between the so-called white business power structure and black leadership about the future of Oakland,'' notes Tribune editor Maynard. He says frustration is ''born not of a lack of willingness to do things, but a lack of solutions. There aren't a lot of models for how to find those solutions, but it (Oakland's situation) is the beginning of a process. It has started with a realization that both communites need each other. They (minorities) have the political clout, but it's going to mean very little in the absence of some economic activity. The seeds are clearly planted for development of a way to be successfully diverse.''

The commitment of community leaders like Bob Maynard, Dick Spees, and Lionel Wilson to making Oakland a more prosperous and livable city and their optimism about its future are well known. But their determination and confidence will have little effect unless they are reflected by thousands of ordinary citizens - like Eugenia Harrison. A black grandmother, Mrs. Harrison recently acquired the butcher shop in historic Housewives Market where she has worked for 20 years. She and her husband financed it with the aid of the white owner, who has retired , and without government assistance.

Mrs. Harrison says she has never felt the sting of discrimination in Oakland, but adds, ''I never thought I could do this'' - have her own business.

She explains that she is confident about Oakland's future. ''There are long-range plans (for economic expansion), and they won't happen tomorrow, but they need merchants to help sustain it,'' she says. ''I'm optimistic, and if I wasn't I never would have gone into this business.''

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