THE Communist Party's startling descent following the failed coup, capped by Soviet President Mikhail Gorbachev's resignation as party leader, began with the removal of the statue of hated KGB founder Felix Dzerzhinsky.Mr. Gorbachev announced he was stepping down as general secretary of the Communist Party and ordered the confiscation of its property on nationwide television late Saturday. The actions came after three days of increasingly angry public demonstrations against both the party and Gorbachev, turning an attempted hard-line coup into an anticommunist revolution. Dzerzhinsky's likeness had dominated the square in front of the dreaded Lubyanka, the KGB headquarters, since the 1950s. With the defeat of the coup and the arrest of the conspirators, it became the first target of the public backlash against the party. People began to congregate around the statue immediately after a massive rally Thursday celebrating the triumph of the democratic forces headed by Russian President Boris Yeltsin. "It's completely natural that the people turn against the KGB first, because it oppressed the people for so long," said Alexander Sidorov, a chemist, who was among the onlookers. The first attempt to topple the statue was clumsy. About three thousand people milled around the pedestal while a couple of zealots, with red, white, and blue headbands, climbed up the 35-foot-tall statue wrapping cables around Dzerzhinsky's torso. The efforts were halted when Moscow city officials arrived on the scene and announced the statue would be removed in an orderly way using cranes to prevent any injuries. It was Gorbachev himself who gave new momentum to the removal efforts, when he defended the party and denounced the effort to tear down Dzerzhinsky's statue at a news conference Thursday evening. Ignoring Gorbachev, about 50,000 people gathered in the square by 10 p.m. By then, four cranes and other vehicles were busily working to bring down the statue. In the carnival-like atmosphere, some students paraded around red plaques removed from the Communist Party buildings, to roars of approval from the crowd , before ceremoniously smashing them to bits. Around midnight a steel noose was slipped around the statue's head and other cables around the body to the delight of the crowd, whose cheers reached a near frenzy. Two cranes then maneuvered into position and with a tug, Dzerzhinsky's statue tilted to a 30-degree angle. The next tug lifted the statue off its base and the crowd, which was being held back by police and a Russian parliament security force, pressed forward. There were wild cheers, and some shot off flares, while others tossed their hats in the air. The statue was then loaded on a flatbed truck and taken away. "People are starting to realize they are free," said Oleg Chernyak, a university student, after the toppling. "The Communists won't last for long." Gorbachev's appearance on Friday before the Russian parliament, most of whose members had stayed for days in what became the fortress of the resistance to the coup, marked another blow to the communists. While answering deputies' questions, the Soviet president was repeatedly subjected to heckling and humiliation. He was bullied into confirming Mr. Yeltsin's choices for key government posts, including KGB chief, defense, and interior ministers. The previous ministers were among the coup conspirators. Gorbachev could only stand and watch as Yeltsin suspended the Russian Communist Party. He tried to say something while standing at the podium but was drowned out by the deputies' applause until Yeltsin, barely able to conceal his satisfaction, announced: "The decree is signed." It only got worse for Gorbachev when he left the building. An angry crowd surrounded Gorbachev's limousine and screamed "Resign! Resign!" and spat at the vehicle. Witnesses said the president looked badly frightened as he drove away. Gorbachev tried to make amends Saturday by attending the funeral of the three men who were killed by Soviet Army tanks during the attempted coup. Looking meek and sounding subdued, Gorbachev promised the coup conspirators would be properly punished. But that did not satisfy the crowd, as the president was heckled, despite the solemnity of the occasion. "It took courage to attend the funeral, but let's not forget that Gorbachev appointed most of the people who betrayed him," said Ilya Koshenko, an engineer. "I won't be sorry to see him go." Hundreds of thousands of people attended the funeral on the central Manezh Square. The Russian tricolor, as well as other republican flags, and even a Union Jack, fluttered in the breeze as the people listened to the host of eulogies, including a prayer in Hebrew said for one of the victims, Ilya Krichevsky, whose coffin was covered by a traditional Jewish prayer shawl. The coffins were then loaded onto flatbed trucks and the funeral procession wove its way through central Moscow to the Vagankovskoye cemetery. Onlookers three deep lined the route, some standing on the pedestal of a statue to Mikhail Kalinin, an early Bolshevik leader, that had been torn down the night before. Mourners were absolutely silent as the funeral cortege passed. Old women wiped away tears. And in front of the advancing procession, many laid flowers in the streets, badly scarred by tank tread ma rks. "These boys did not die in vain," said Russian Foreign Minister Andrei Kozyrev, as he stood in the procession before it began to move. "They gave their lives so that Russia and the Soviet Union could become a free and democratic nation."