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Steve Stern has long been admired as a big writer in a small way: as a writer of prodigal gifts that have found their best expression in short stories and novellas. His talent shows affinities to the writers from whom he has drawn his inspiration: Franz Kafka, Bernard Malamud, Isaac Bashevis Singer and Nachman of Bratslav.

His most indelible fictions have tended to be the iridescent little fables that he conjures up in books like "Lazar Malkin Enters Heaven," "A Plague of Dreamers," and "The Wedding Jester." These are his little universes in grains of sand; his dreams and miracles stenciled in over maps of real places, like his home town of Memphis, Tenn. Reading Stern can be like calling up Mapquest and getting the fourth dimension: You ask him for a street number and he gives you its astral coordinates.

The whole of his new novel, "The Angel of Forgetfulness," is like one of the stories writ large. It follows the misadventures of one of Stern's bookish dreamers, Saul Bozoff, a refugee from Memphis who finds himself adrift in New York, after finding that college was not for him.

I was lonely in New York in 1969. I'd come from the South with great expectations, certain that the city would somehow change me from a timid misfit into an intense if melancholy young hero. A poete maudit. I longed, so I thought, for the reckless bohemian life, the dereglement de tous les sens, and believed that New York City, through the crucible of its charged atmosphere, would effect that transformation overnight.

His solace is an aged aunt, Keni Schendeldecker, a painter with a smoker's cough and a dowager's hump who peers at him through thick glasses. She had remained on New York's Lower East Side long after virtually all other Jews had fled. Entering her apartment he finds that he has walked into a time machine, a place "crammed with ponderous furniture: a mahogany sideboard, a barge-size sofa, a pair of grease-stained Morris chairs with cushions like craters. There was some cheesy bric-a-brac and lace-curtained windows . . . and plaster walls of an indeterminate color practically obscured by a gallery's worth of garish paintings."

For all the ramshackle detail -- and there is no eye keener than Stern's for the fine print of decay -- Bozoff has wandered into a dream world, and as he moves in with Aunt Keni he becomes possessed by her memories and heir to her paintings and a dusty manuscript left her by a suitor from the old days. He was Nathan Hart, a scrounger and a yellow journalist for the old Jewish Daily Forward, who courted her with impromptu tales of angels and gangsters and one Nachman, the son of a mortal woman and a shabby seraph named Mocky.

In an early Stern short story, "The Ghost and Saul Bozoff," a struggling writer afflicted with writer's block is shown a visionary Memphis by a ghost who tells him tales of enchantment in tenements and butcher shops, laundries and synagogues. Nathan Hart is just such an angel, whose manuscript takes Saul on a magic carpet ride to old Hester Street, where he meets its poets and tailors, its journalists and its gangsters, its rail thin women who "fingered the entrails of hanging fowl to determine their kosherness" and "haggled with merchants who alternated between deference and poisonous invective."

In moments of desperation, Nathan takes to hanging out with gangsters with names like Chaim the Mummy, Hodel the Mattress (guess what she does), Gyp the Blood, Little Kishky, and Felix Rothkopf, aka Cutcher-Head-Off. And he courts a beautiful woman who works at the laundry, Keni herself, with stories of the supernatural that are so seductive that she is swept off her weary feet.

Saul Bozoff, meanwhile, is off on his own misadventures that take him from a mental institution to a dropout commune among angel-headed hipsters in Arkansas. The farm is itself a visionary place that its inhabitants variously call Cockaigne, Klopstokia, The Vegetable Kingdom of Thumbumbia, the Nature Theater of the Ozarks, the Gulag, and Brigadoon. Very very literary. And then, with money from Aunt Keni, he is off to London and Prague, where he meets up with the strangest angel of them all, a spidery fellow in a transparent rain slicker named Svatopluk Lifshin, who takes him on Magical Mystery Tour of Prague, which ends up with both of them smoking golem dust in the loft of an ancient synagogue.

Stern's "The Angel of Forgetfulness" is pure Jewish Gothic: Franz Kafka on blotter acid, Bruno Schulz on Xanax, Isaac Bashevis Singer doing weed with Allen Ginsberg. At one point, Nathan Hart shows his unpublished manuscript to the great editor of The Forward, Abraham Cahan, who pronounces it drivel and tells him "there's nothing wrong with your writing that a stiff dose of reality wouldn't cure." He sends Nathan off on assignment: "Get thee gone and write something real for a change."

It is Steve Stern who takes that commandment to heart. "The Angel of Forgetfulness" is at bottom a realistic novel, as well as an irrepressibly comic performance. It just happens to be about the kinds of people Stern understands best: dreamers and visionaries and citizens of both heaven and earth.

The Angel of Forgetfulness

By Steve Stern


820 pages, $24.95

Mark Shechner is a frequent News book reviewer.