In the decade since Sen. J. William Fulbright came within a hair of shutting it down with proof that it was being covertly financed by the CIA, Radio Free Europe has slowly turned itself into a more middle-of-the-road station.
On June 10, however, James S. Brown, director of RFE since 1976, resigned, citing ''political differences with the way the Reagan administration is now directing the radio.''
The immediate reason for Mr. Brown's decision to step down as director and become a consultant to RFE for six months, was that the Reagan administration's Board of International Broadcasting (BIB), which oversees RFE, refused to approve Brown's choice of Josef A. Schneider to head RFE's Czech news service. (RFE broadcasts news and commentary daily to five east European countries - Czechoslovakia, Hungary, Romania, Bulgaria, and Poland.)
Mr. Schneider, RFE sources report, is known as a political centrist within the Munich-based US-financed station. Reportedly, Mr. Schneider's appointment was not approved by the BIB because Mr. Schneider, who has been acting head of the Czech service for several months, had taken a laissez-faire attitude toward some members of the Czech desk who do not have a strong anticommunist slant in their stories.
''There are a group of people who were leaders in the Prague spring rebellion in 1968,'' says the same source. ''Some of them see themselves as Socialist reformists. They are not capitalists and did not grow up under the capitalistic Western political system. Mr. Schneider's view, and Mr. Brown's, was to let them speak to their own Czech generation in political terms that they would understand. Unfortunately, sentiment within the Reagan administration sees this as anti-American and soft on communism.''
In response, BIB director Frank Shakespeare says, ''We think it is very unfortunate that James Brown has resigned over this matter. He is highly thought of in the international community and Mr. James Buckley, president of RFE, spent a long time last week trying to convince him to stay on and run the operation. We hope he will be with us as a consultant for a long time. We did not tell him definitely that Mr. Schneider was being rejected hands down. No final decision had been made on the matter.''
Tension has been mounting for months inside RFE's white stucco building on the edge of an English garden. Long overtime hours reporting on the Polish crisis have taken their toll on the East European emigre editorial staff. And political generational differences have more and more become a dominant source of antagonism among RFE editorial staff people. Those who left the East bloc in the late 1940s and described themselves proudly as ''cold warriors'' against the Soviet Union, dislike the newer political tones, and RFE career advancements of those younger staffers who grew up within the Soviet satellite system regime.
Mr. Brown says that he has been trying to make RFE ''into a rational voice that lets those in the East bloc get a good understanding of what is going on in the US, and especially what is going on on their own continent of Europe.''
Without the RFE, comments Vlad Georgescu, head of RFE's Romanian news service , ''you might get the feeling that life in Poland or Romania today is normal, and that would be the sickest joke of all. Everybody in Solidarity spent hours glued to their RFE station before they were hauled off to prison.''
RFE staffers say they have had to fight hard since 1971 to shake off the CIA taint and establish credentials as a responsible radio network. ''We can't afford to be turned into a pure Reagan propaganda machine,'' worries a senior staff member. ''Very simply, it is not in our best long-term interest.''
Radio Free Europe today is an institutional hybrid gradually evolving into a multidimensional radio station with staff people who represent a broad spectrum of political beliefs. Many of the hard-line ''cold warriors,'' whose commentaries remain highly anti-Soviet, are still on RFE's staff. (The Soviet Union in fact pays RFE the supreme compliment of spending at least twice as much effort jamming its programs to Poland as those of its competitors.)
RFE's ongoing problem, and a very serious one - is the difficulty of dealing rationally and coolly in its editorial policy toward governments that are often acting in inhumane ways. Because of the largely emigre staff, emotions continue to run much higher than they do at most other international institutions. But James Brown, as director, has been given high marks by many inside RFE for trying to set a rational, intelligent tone to RFE.
''We have been called an anticommunist station,'' says the tall bespectacled Brown, who is British. ''We are, in a sense. But I should like to think we are more than that. When the Socialists won the election in France, we reported it extensively, and I think fairly. I don't think that would have been done during the 1950s.
''The longer the East Europeans are separated from the rest of Europe, the more they seem to hunger for news. They are intensely aware of what is going on in France and Germany. Many of them still talk a lot about the Yalta complex - the fact that nobody outside really cares about them anymore.''
Speculation within RFE headquarters now has it that Mr. Shakespeare's failure to confirm Mr. Schneider as Czech news director indicates a return to a more consistently tough political posture by RFE and the beginning of a less individualistic approach to news commentary by editorial writers there. Says one veteran resident. ''The hard-line elements in the building definitely have their tails up now.'' As of yet, there is no replacement as director for Mr. Brown.