DONJI RACIC, CROATIA — A WOODEN cross and a large Bible in a local Serbian Orthodox church were set on fire four days after Croatian troops took control of this village in eastern Croatia. Several houses abandoned by fleeing Serbs were ransacked. And Serb refugees have accused the Croatian Army of killing dozens of Serb civilians as they tried to flee to neighboring Bosnia.
But in nearby Pakrac, Croatian policeman described as ''courteous'' by Serbs and ''professional'' by European Union monitors rounded up more than 2,000 Serb men and bused them to nearby towns for screening as suspected war criminals. No human rights violations were reported.
Which of these two very different descriptions of the Croatian Army prove more common over the next several months may help determine whether peace or a wider war comes to Croatia and the former Yugoslavia, according to Western diplomats.
Croatia has a rare opportunity to disprove widespread Serb fears of discrimination -- frequently played upon by Serb nationalists -- which lie at the heart of the conflict.
If Serb human rights are respected, and some self-rule granted, Western diplomats hope to show Serbs in Croatia and Bosnia that they can live peacefully as minorities in the two countries.
And Croatian officials are vowing to turn Western Slavonia, the area captured last week, into a model of ethnic harmony. But whether Croat intentions are sincere, and four years of conflict can be overcome, remains unclear.
''They're talking nicely to us now,'' whispers Lazarka Blaskovic, an elderly Serb who stayed in her village to care for her husband. ''But what will happen later? They'll kill us.''
Western observers say allaying the fears of Mrs. Blaskovic, must be Croatia's top priority.
''What happens now will be a critical test of whether it is possible to implement a political solution [to the war],'' says a senior Western diplomat. ''The Serbs have to feel as comfortable in Croatia as the Croats do.''
Disputes have already erupted over the Croatian Army's conduct during the offensive. UN officials say as many as 30 civilians were shot as they tried to escape to Serb-held areas in Bosnia.
Croatian troops allegedly opened fire on civilians fleeing along a stretch of highway near the only bridge to neighboring Bosnia. The Croatian government, which has not released a casualty total, says that a small number of civilians who were mixed in with retreating Serb soldiers were accidentally killed.
Approximately 7,000 Serbs fled to Serb-controlled parts of neighboring Bosnia when Croats launched an offensive to take control of a strategic highway from Zagreb to eastern Croatia last Monday. In some Serb villages, abruptly abandoned kitchen tables with neatly arranged place settings could be seen, and farm animals freed by Croatian troops wandered the streets.
State-dominated Croatian television has meanwhile urged the Serbs still here to stay. Interviews with Serbs who say they have not been harmed by Croatian forces are featured nightly on Croatian television -- which is broadcast into rebel Serb-held areas.
In Pakrac, the Serb town where men were rounded up and taken away for registration, visibly shaken women said they feared for their sons' and husbands' lives and said they wanted to go to Serb-controlled parts of Bosnia.
Many complained that the Croatian government had broken a deal being negotiated by the UN that would have allowed residents of the surrounded town to go to Bosnia if they wished.
''It's difficult to believe them, there was an agreement that we would be free to leave here but that was not respected,'' Pakrac resident Milosava Vidic says as she bursts into tears. ''I don't know how I can live here in the future.''
Serb rebels have long said they refuse to live under the Croatian government because they feared a resumption of World War II-era Croat atrocities. A pro-fascist Croatian regime ruled over a large part of the former Yugoslavia during the war and hundreds of thousands of Serbs were killed in Croat-run death camps.
Serbs in Pakrac said their fear is not of organized persecution by the government, but of discrimination from Croats embittered by a war in which most families have lost loved ones. Letting go of mistrust and fear bred by four years of conflict will be difficult, if not impossible.
''If I go back to my village how will people treat me?'' asks Milica Schubert, a Serb refugee who says she moved to Pakrac when her ethnically mixed village fell under Croatian control in 1991. ''I don't know how not to be afraid.''