TEXASVILLE by Larry McMurtry (Simon & Schuster: $18.95; 525 pp.)

Welcome back to Thalia, seat of Hardtop County, Tex., where the terrain is so flat that the net at the municipal tennis court forms a skyline.

Readers of Larry McMurtry’s “The Last Picture Show” will be surprised to hear that Thalia has anything so grand as a municipal tennis court, but much has happened since we last visited the town in the 1950s. An oil boom in the energy crisis of the 1970s made everyone so nouveau riche that they felt compelled to take up leisure with a vengeance, hence the tennis court, the hot tubs and the VCRs that replaced the old movie house that burned down.

It didn’t last. The oil glut of the 1980s has made everyone nouveau bankrupt, and men once vigorous in their wealth are now sexually impotent. No one has anything to do except meet at the Dairy Queen to talk nervously of their unsatisfied women and fantasize about blowing up OPEC if only they knew where it was.

The sequel opens with Duane Moore in his hot tub, shooting .44 slugs at his dog’s luxurious Neiman-Marcus doghouse, never occupied because the dog prefers the front seat of Duane’s old pickup. Duane is 48, has $850 in the bank and is $12 million in debt. His voracious wife Karla wears T-shirts with unsubtle messages like “You Can’t Be the First but You Can Be Next.” Their two teen-age children, Nellie and Dickie, are well into nymphomania and satyriasis, while their two younger children have just been thrown out of church camp for destroying the latrine and lacing the preacher’s oatmeal with LSD.

On top of these troubles, standard by now, are two new ones. Duane hears that his high school sweetheart, Jacy, has abandoned her career as a female Tarzan in Italian B movies (her film name was “Jungla”) and is returning to Thalia. The other problem is even more potentially explosive: Thalia’s upcoming Centennial, of which Duane is chairman. The town wants to rebuild the original county seat, Texasville, and trace it all the way back to the back of beyond, and therein lies the danger. Thinks Duane: “The necessity of staging the Revolutionary War, the Texas War of independence, the Civil War, the two World Wars and possibly Korea and Vietnam worried him a good deal, considering the stressed-out condition of the people who would be simulating all that combat.”

A valid worry, in view of the fact that there are only two normal people in town, and one of them is quietly losing his mind. Duane’s secretary, 72-year-old Ruth Popper, is the only Thalian who jogs. Getting rid of her gross husband, Coach Popper (he died of cancer while awaiting trial for murder), has given Ruth a new lease on life. Though she doesn’t have much future left, she is firmly committed to it, but Sonny Crawford, her former lover and Duane’s best friend, is stuck in the past. Obsessed with memories of the 1950s, Sonny suffers blackouts in which he searches the parking lot for his old ’46 Chevy, wanders off from the little grocery store he now owns, and starts seeing old movies in his head with a terrifying immediacy that no VCR can match. Finally, he buys the shell of the burned-out movie house, where he is found “sitting in the fragment of balcony in one of the two seats that had not burned. There was nothing below him but the charred remains of the original floor, and nothing above him but the blue morning sky.”

I see a two-part, made-for-television movie in my head, one that will cash in on the Texas troubles we have been seeing on the evening news, full of repossessed BMWs, hocked Rolexes, and dialogue fraught with the word stress. Although this sequel has some wonderful moments--Sonny’s retreat from reality is described with poignant tenderness--I still prefer the poor Thalia of the first book. “The Last Picture Show” had the concise classical rigor of “Ethan Frome,” but “Texasville” is too long and sprawling, and contains more interchangeable female parts than McMurtry seems to know what to do with. Karla, Suzie, Nellie, Janine and Jacy all run together like an underdone pudding. It’s impossible to develop a clear mental picture of any of them except for a vague collective resemblance to Carroll Baker in “Baby Doll.” They are the kind of overheated babe that has to be pulled out from under her daddy’s pickup truck in an Erskine Caldwell story, constantly playing with herself as her pulse overtakes her IQ.

Like so many American male writers, McMurtry has trouble characterizing women in their sexual years; only when a woman is over the hill, like Ruth Popper, does he seem able to relax and craft her into a three-dimensional human being.

His discomfiture when writing romantic scenes manifests itself in lines delivered with a plunge into what-the-hell giddiness, like “the blush of pleasure still coloring her cheeks,” which is pure Barbara Cartland. At other times, it comes through as a stiffness that reeks of Me-decade workshops and yuppie-oriented computerized dating services: “He wasn’t in love with Suzie. The two of them were just having an interlude of good luck involving a high level of sexual compatibility.”

The most outlandish exercise in heterosexuality is the finger-biting scene in which Duane stands beside Suzie’s car and feeds her his hand. We are not talking about love nibbles here but a down-to-the-bone chew that sets Duane to thinking: “He had a sense that life was about to jump the fence of credibility and become completely unbelievable.” Yes, indeed. Somewhere in here, McMurtry also gives us the spectacle of an erection getting caught in a car door handle--a good ol’ boy mishap if ever there was one.

Incidentally--meaning that I can find no other place to put this comment--although Duane is justifiably distraught by all his troubles, it still does not explain why he speaks in such uncharacteristically good grammar. A self-made Texan whose education stopped at Thalia High School does not use the future perfect tense, but Duane says things like “by then every Cadillac in town will have been repossessed.” He also says “Good morning” to the roughnecks at the Dairy Queen, but they, unlike your reviewer, find nothing odd about it.