IN THE Philadelphia streets, the American dream appeared to have died. No one, it seemed, still believed that hard work and sacrifice bring fortune and success. "You work so hard," a small-time, has-been boxer says to his girlfriend in the film Rocky. "It don't matter. I was nobody before." Diligence is no longer enough to get ahead on the city streets; now a man's got to have luck if he's not to be forgotten. Rocky slips quietly into the mildly criminal life of the city. "Well, it's a living," he says. But underneath he knows it's a waste of life. Meanwhile, the dream has died.

Suddenly, with the shock of a sharp right punch coming out of nowhere in the Philadelphia slums, Rocky becomes an astonishingly uplifting film that asserts that the American dream has been reborn. Rejecting the recently all-too-tempting directors' urge to make films about antiheroes who are as corrupt and malicious as the systems they fight, director John G. Avildsen has probed the boxing world to tell the all-American story of Rocky who jumps from obscurity to the lights at the top.

Ironically, Avildsen has intentionally chosen this bigger-than-life storyline to test the reality of the dream. What heavyweight champion could, like the film's smooth-talking Apollo Creed, choose his own challenger for a staged New Year's Day bicentennial fight? And who would believe that even the media-mad Creed would bill the fight as the symbol of American opportunity because it pits a certain-to-lose unknown white challenger against a virtually undefeatable black?

Nobody would, anymore, of course. Nobody, that is, except Rocky Balboa, the "Italian Stallion" Creed chooses who, in his way of innocence, still believes that dreams come true. Rocky is an ordinary guy cloaked in the garb of a hero. With his desire to fight the good fight in spite of the odds, he is an admirably uncompromising man in a compromising world.

"Listen," he tells a girl who stands on street corners with the local gang, "if you keep hanging out with them, you're gonna get a bad reputation." Rocky refuses to recognize the values of the street. Nor can he bend to the instructions of his employer, a local loan shark. Instead of "breaking the thumbs" of a client Rocky only points a warning finger and cautions "You should a' planned ahead," shaking his head, "You should a' planned ahead."

In a world that takes the easy way out, Rocky insists on not taking any "cheap shots" and working hard. When he finally reaches the ring, Rocky, at 190 pounds, is obviously and superbly prepared. He has trained--punching, dancing, working on the elements of his style--in a way he never bothered when he still labelled himself a "loser" during his ten years as a fighter before. In a beautiful sequence set to Bill Conti's gradually crescendoing music, the camera follows the progress of Rocky's 4 a.m. runs around the sleeping city as he gets faster and the early shoppers begin to recognize him as a kind of local hero climaxing in the one morning when he finally mounts the steps of the capital just as the sun comes over the top of the skyscrapers. It is a vision of triumph; only the slow motion of Rocky's victorious jumping in the air is a little overdone.

THE POINT IS that Rocky, an ordinary hero, if given the opportunity, can rise to any heights. The secret of his success, and that of this warm, funny, most sincere film is older and more forgotten than any other dream: quite simply, they believe in themselves. Twice each day Rocky stops at the neighborhood pet shop to crack a joke, trying to get the attentions of Adrian, an unmarried, unsought "loser" who stands without a word, feeding the caged birds. "Hey, I hear she's a retard," the loan shark's driver mocks Rocky. But under the fighter's clumsy, tender patience, Adrian emerges from behind her harlequin glasses as an appealing, attractive woman. "I always knew you was beautiful," Rocky whispers. With a sharp jab from the left, Rockybecomes a love story.

The language of the film speaks for itself. Its words belong to the man on the street; its tempo gives the movie the balanced, quick paced, one-liner feeling of a fight. The characters in Rockycan't ever say exactly what they mean--they choke their subject or miss the mark, shooting straight from the hip--but in their very inarticulateness their funny, everyday struggles are revealed.

Sylvester Stallone, who wrote the script and who also plays Rocky, is himself a testament to that struggle. He has appeared from the middle of nowhere in the Brooklyn streets of the Lords of Flatbush to write a script and give a performance good enough to win him two new titles. As Rocky, Stallone is the most likeable, unlikely of heroes. He projects a toughness toward the world that, underneath, is deeply touched. Standing with a blanket wrapped around him after his early morning workout, Rocky is a tired boxer, but also a sick old man or a proud Indian chief. Stallone takes each scene as if it were a long, hard blow and then slowly arises, overcoming the inertia of years of failure.

The other parts, in which the characters line up between those who, like Rocky, can stand to fight the good fight and those who cannot, are also wonderfully played. Talia Shire gently coaxes out the part of Adrian so convincingly that her transformation from ugly duckling to beautiful swan becomes believable. As Paulie, her butcher brother who hates freezing himself in the meat house each morning and warming himself at the neighborhood bar each night, Burt Yound succeeds in explaining why the miserablesometimes don't give in. Perhaps best of all is Burgess Meredith, Rocky's manager. In a touching scene in Rocky's apartment, where the faces are flooded with an almost holy white light, Meredith, as a fighter who was never given a fair chance, gets from Stallone what the audience gets from the film--a reason to hope.

On the other side of the ring, Carl Weatherman is splendidly self-confident as the black Apollo who is seen first through his proper medium, the T.V. And Thayer David flashes the false smile of a true promoter, his waxy face cracking as he realizes that Rocky has taken the fight to heart.

THE LIGHTS flare up in the arena, the microphone drops in a terrific shot taken from above, the crowd, which has been skillfully clipped from films of actual fights, roars. Apollo Creed, who has sent flowers to the mayor's wife, and comes out through the aisles dressed as George Washington in an extravagant Crossing the Delaware parade, means business in this fight, but he does not know that Rocky means business too. Round after fifteen rounds, Rocky stays up, going for the champ's weakened right side. "He doesn't know it's a show; he thinks it's a goddamn fight," Creed's trainer panics. But it is precisely because the championship has become the symbol of Rocky's struggle to show that he can "go the distance" against all those anti-heroes who give in that this powerful, realistically photographed last scene makes this fight more than a fight.

Rocky, of course, loses, on points. But, the film asserts, he has really won. After it's over, he tells Adrian "I'm gonna know for the first time in my life that I'm not just another bum from the neighborhood." With Rocky everyone from every neighborhood should cheer. Only the unrealism of the American dream has died.