Of Love and Shadows<i> by Isabel Allende; translated from the Spanish by Margaret Sayers Peden (Knopf: $17.95; 247 pp.) </i>

It is as if, after years of silence, Isabel Allende had permitted herself to reveal a tragic and macabre secret embedded in what might have been an ordinary love story, except that it takes place in a country where politics intrudes upon ordinary love.

Irene and Francisco are chosen from among many in the author’s memory (according to the book’s poetic preface), whose stories demand to be told, lest they be “erased by the wind.” They are the youth of the Latin American diaspora, generously drawn and almost Shakespearean in their purity and passion. She is beautiful, sensitive, kind to the elderly; a well-born innocent working as a writer for a women’s magazine. He is an unemployed psychologist-turned-photographer: noble, gentle, and vaguely engaged in the dangerous, secret work of shepherding political refugees out of the country. They team up for the magazine, and in their relentless pursuit of a certain story, they make the discovery that is this novel’s raison d’etre.

In her first novel, “The House of the Spirits” (Knopf, 1985), Allende (niece of the former Chilean president) proved herself a gifted magic realist in the grand company of Gabriel Garcia Marquez. Her newest work is less ambitious, but even in this slender triptych, whose centerpiece is a Boschian vision of the consequences of absolute power, there are all the wonders of magic realism: hereditary destiny, demonic possession, dancing tableware, incestuous love and its consequence. Two baby girls switched at birth exchange destinies. One of them spends her childhood playing sex games with a “brother,” (unrelated to her by blood), who grows up to join the military. Neither can endure their separation, and her thwarted erotic desires erupt in strange seizures mistaken for saintly fits by the townspeople. The girl, a disturber of the peace, disappears at the hands of the military, as does her pining brother. The trail of her corpse leads Irene and Francisco inexorably into each other’s arms, then to the discovery of a military secret.

The lovers’ decision to bear witness, to take responsibility for what they have seen, leads them through the thickets of intrigue, where they are aided by a procession of compelling minor characters. There is Francisco’s father, Professor Leal, an anarchist refugee from Spain who refused to wear socks until the dictator died; Beatrice, Irene’s impoverished society mother, who converts the first floor of the family house into a rest home on the pretext of charity, and there are the guests of the Will of God Manor themselves, whose cameo appearances cast the pathos of dying alone in fine relief. There is the dead girl’s circus clown father, who learns from the death of a trapeze artist that “a man’s brain looks just like calves’ brains,” foreshadowing the more gruesome discoveries to come. Finally, there is Mario, the homosexual stylist who disguises the lovers for their escape.

This is a novel about institutional violence, of the sort perpetrated by authoritarian states; it is about human rights and their loss, and the difficulty of documenting that loss, so as to move the collective conscience of the world. It takes place in an unnamed country, but we clearly recognize Allende’s native Chile from the clues she has strewn along the way. We read not so much to discover whether her fairy-tale lovers will survive, but so as to appreciate Allende’s clear elaboration of moral life. We are by turns enchanted and entertained, as in a fairy story, and although we are in “a land of hurricanes, earthquakes, rivers broad as the sea, jungles where sunlight never penetrates, where mythological animals creep and crawl over external humus alongside human beings unchanged since the beginning of time,” we are also in the very real present, where people are “suffering in the cane fields; shivering with fever in the tin and silver mines; lost beneath the water, diving for pearls; surviving, against all odds, in prisons.”

We are so enchanted that it is easy to miss Allende’s most shrewd revelations, as when she describes a military equipped with “sensitive listening devices purchased in Biblical lands,” “apparatus acquired in the Far East that enabled them to see through walls in the dark,” and the less cryptic “European telescopes and North American infrared-ray machines,” that bestow magical powers on the forces of darkness in this unnamed country. We hear the “yellowed bones clacking like castanets” and in our wonder are willing to accept that “It was a world of deprivation and penury in which the only consolation was solidarity.”

Gabriel Garcia Marquez once advised aspiring writers that anything could be said on the page, as long as it could be made believable. Allende has married the world of magic and political evil most credibly. The translator whose gift it was to bring this novel into English, Margaret Sayers Peden, deserves a nod as well for the accomplishment of creating an American language for Allende’s deeply lyrical voice.