IRAN'S capital of Tehran is alive with political intrigue and gossip, much of it centered on a sharp debate that has set old-style Islamic hard-liners against a new class of technocrats. Some Iranians speculate that they are seeing early signs of a fundamental change within the ruling elite.
''There is an open debate now, especially in the universities and the newspapers,'' says a political science student at the University of Tehran. ''Political factions are being identified in the press, and there's a lot more openness in the debate. In the Shah's time, no one wanted to talk about politics; it was too dangerous. Now, no one can talk of anything else.''
Over the last two years, nonideological administrators, such as pragmatic Tehran Mayor Gholam Hussein Karbaschi, have assumed a wider role at the expense of Islamic theologians who have been directing much of Iran's domestic economic and social policy since the 1979 revolution.
Since he took up his post in Tehran in 1990, Mayor Karbaschi has transformed the city, building parks and cultural centers, planting trees, and imposing traffic restrictions in an attempt to reduce the capital's severe air pollution. To pay for these improvements, he has imposed tough taxes on Tehran's powerful bazaaris, the businessmen who run Iran's private-sector economy and who provide vital support to the Islamic clergy.
In the process, Karbaschi and his fellow technocrats have made powerful enemies among radical religious politicians who say the reforms are deflecting the country from the path of the late Ayatollah Ruhollah Khomeini, who led Iran's Islamic revolution in 1978-79. ''The bazaaris and the clergy oppose someone like Karbaschi who might actually shake up the way Iran has done business for centuries,'' says an Iranian journalist connected to the regime.
Hard-liners within the ruling elite have launched a counterattack. Two months ago, Ansar-e Hizbollah (Supporters of Hizbollah), a grass-roots movement based in Tehran's poor southern suburbs, began protests against targets such as Western-style rap music. Well-placed Iranians say the group is directed by Ayatollah Jannati, a member of the Council of Guardians, an Islamic oversight committee.
''Jannati's group arrived on the scene just as this debate got going,'' says an Iranian businessman. ''I don't think that was a coincidence. He's trying to maneuver the radicals into a more prominent position before the parliamentary elections in March.''
Despite such militant noises from the radical right, there is a growing realization in Tehran's leadership circles that the economy must be managed more efficiently. Sound economics, rather than religious ideology, is starting to take precedence in decisions. Analysts point to Iran's willingness to sign a $1 billion oil contract with the American oil firm Conoco in March, a deal that was subsequently halted by President Clinton, as evidence of this new pragmatism.
Western business representatives in Tehran say complete freedom of speech is a long way off, but Iranians are encouraged by signs of change. ''I can criticize anyone in my articles except the Leader of the Revolution [Ayatollah Khomeini]'' says Saeid Leylaz, a TV and newspaper reporter in Tehran. ''President, parliament, individual mullahs - I can criticize them all.''
Newspapers now routinely identify political factions within the leadership, a move that has led to calls for the legalization of political parties, banned by Ayatollah Khomeini in 1985. Opposition groups within Iran have led the calls, but even presidential advisers now concur.
In three months, Iranians will elect a new parliament. ''The degree to which opposition parties are tolerated is a necessary criterion for every country,'' says Ibrahim Yazdi, secretary-general of the opposition Iranian Liberation Movement. ''Whether we win in the elections is not important. The government must recognize the value of a loyal opposition.''
Dr. Yazdi explains that, although the group is still banned from registering as a political party, the Interior Ministry has authorized its members to run for parliament individually. The regime is cautious about legalizing Yazdi's movement because it is partly influenced by the writings of Abdelkarim Soroush, a prominent liberal Islamic university lecturer. Mr. Soroush is often described as an Iranian Martin Luther for tentatively advocating the separation of mosque and state.
BUT Iranian and foreign observers point out that even some mullahs believe that religion should have no place in politics. Indeed, the authorities are said to be looking for a nonclerical candidate for the presidency when President Hashemi Rafsanjani's second term ends in 1997. ''There is a growing feeling among the Shiite hierarchy that the incompetence of the political leaders has actually hurt the religious base in the country,'' says a European diplomat in Tehran.
No one is expecting the mullahs to disappear from politics - Ayatollah Ali Akbar Nateq-Nouri is considered to be the front-runner in the 1997 presidential battle - but the openness of the debate is a sign of evolution within the Islamic republic. ''The growth of the technocrats is an irreversible trend in Iran,'' says the European diplomat. ''There's definitely a feeling among the Iranians that they have to run the country better if they want it to survive.''