Beloved <i> by Toni Morrison (Knopf: $18.95; 276 pp.)</i>

Toni Morrison’s masterwork is a ghost story about history. At the center of its circle is an act as awful as anything imagined in the Old Testament or Greek mythology. Inside this circle of space-time--spellbound, dream-dazed--the living and the dead talk to and lay hands upon each other. Madness and memory cohabit. It’s as if history were our collective unconscious, and the dead, like the repressed, return.

Remember slavery? Morrison does. Although “Beloved” begins in 1873, it has more than 20 years of explaining to do before we understand how Sethe and her 19-year-old daughter Denver and their ghost happen to be hiding from the neighbors and the past at 124 Bluestone Road, Cincinnati, Ohio. We have to go back to Sweet Home, Ky., in the early 1850s, where the owner treated his slaves like “men” by allowing them to decide for themselves just how they would go about getting his work done for him. Then the owner died, and Schoolteacher took over, teaching the Sweet Home “men” that “definitions belonged to the definers--not the defined.”

This is how Sethe, who was a teen-age mother then and pregnant with her fourth, remembers Sweet Home: Two white boys “with mossy teeth, one sucking my breast, the other holding me down, their book-reading teacher watching and writing it up. . . . And my husband . . . watching in the loft--hiding close by.” And the cowhide that left a scar-tree on her back that flowered red roses. And black boys “hanging from the most beautiful sycamore trees in the world.” And the flight, as if out of Egypt, on dead feet; and the birth of Denver, in the bottom of a boat “under four summer stars,” on her river-passage to the free state of Ohio; and “one whole moon” of “unslaved life” before Schoolteacher arrived on horseback at 124 and Sethe like a black Medea raised a handsaw and Denver swallowed her sister’s blood “right along with my mother’s milk.”

And this is what Paul D, “the last of the Sweet Home men,” remembers of Schoolteacher and Georgia prisons and the Civil War and his years on the road until 124: Sethe’s husband with his crazed head in the butter churn, “greased and flat-eyed as a fish”; Sixo, who stopped speaking English “because there was no future in it,” on fire; a three-spoke neck collar and an iron mouth bit; the rock pile and the chain gang; sleeping in coffins and hiding in caves and fighting for food with owls and pigs; bad whiskey, hissing grass, “song-murders,” “laughing dead men,” the trail of blossoms north from dogwood to prickly pear, and “a witless colored woman jailed and hanged for stealing ducks she believed were her babies.”

Paul D wants to put his story, of “sucking iron,” next to Sethe’s story of stolen milk and river-passage, and imagine a future for them. But first he must chase the ghost out of the house. The ghost, of course--a spiteful “pool of red and undulating light” that tips tables and leaves palm prints on the butter--is Sethe’s murdered baby. Once chased, she will be replaced by a huge young woman, risen from the water, with new “midnight skin . . . lineless and smooth, including the knuckles of her hands,” sugar-devouring, diamond-hungry and exactly the age Sethe’s baby would have been grown-up: Beloved. And Beloved chases Paul D.

What chance have Paul D and Sethe? From his travels, “the best thing, he knew, was to love just a little bit; everything, just a little bit, so when they broke its back, or shoved it in a croaker sack, well, maybe you’ll have a little love left over for the next one.” And she believes that “the future was a matter of keeping the past at bay”; she had to kill the baby to save her; her love “is too thick.” Even this land--evoked as if another D. H. Lawrence or Paul Gauguin were at play--isn’t their land. Sethe can’t forgive herself for remembering the sycamores before she remembers the black boys hanging from them: “It made her wonder if hell was a pretty place too.” For Paul: “In all those escapes he could not help being astonished at the beauty of this land that was not his. . . . On nights when the sky was personal, weak with the weight of its own stars, he made himself not love it.” They feel guilty for being diminished.

Morrison does a thousand wonderful things in her circling. She introduces us, for instance, to Baby Suggs, Sethe’s mother-in-law, who used to preach of grace before she became ashamed of God and retired “to ponder colors” on her carnival quilt, and decided, “There is no bad luck in the world but white folks.” And to Amy, a barefoot white girl with unpinned hair, who was on her way to Boston to look for velvet when she stopped just long enough to put spider webs on the bloody tree on Sethe’s back, and to midwife Denver. And to Stamp Paid, watchman, soldier, spy and busybody, tormented by the song and sadness of “the people of the broken necks, of fire-cooked blood and black girls who had lost their ribbons.”

She acquaints us, too, with the unendingness of women’s work, even out of slavery. At home, “they wrung out sheets so tight the rinse water ran back up their arms” and “shoveled snow from the path to the outhouse” and “broke three inches of ice from the rain barrel, scoured and boiled last summer’s canning jars, packed mud in the cracks of the hen house and warmed the chicks with their skirts.” Away from home, “they could have been going to do the laundry at the orphanage or the insane asylum; corn shucking at the mill; or to clean fish, rinse offal, cradle white babies, sweep stores, scrape hog skin, press lard, case-pack sausage or hide in tavern kitchens so white people didn’t have to see them handle their food.”

In fact, instead, these women gather in front of 124--a way-station, after all, for fugitive slaves--and their voices search “for the right combination, the key, the code, the sound that broke the back of words . . . until they found it, and when they did it was a wave of sound wide enough to sound deep water and knock the pods off chestnut trees. It broke over Sethe and she trembled like the baptized in its wash.” Beloved is exorcised. Beloved, “a naked woman with fish for hair,” “thunder black and glistening,” runs from the house to the woods and the river and is gone. For now.

To this walnut density and lyrical muscle, add the Baby Suggs “appetite for color” and some helpful Cherokee Indians. That’s a sufficiency. But leave room as well for a magic of folk and fairy tales, quest and myth: lost children and men on horseback; the handsaw and the ice pick; Denver’s “live green walls” and “emerald light”; Amy’s velvet; Paul D’s smiling rooster; tree cages, spider webs, wishing wells and the madness of hummingbirds with needle beaks as a baby is offered to a God gone home to hell.

All Paul wants is “to get to a place where you could love anything you chose--not to need permission for desire,” and a woman like Sixo’s, “a friend of my mind”: “She gather me, man. The pieces I am, she gather them and give them back to me in all the right order. It’s good, you know, when you got a woman who is a friend of your mind.” Not in this history, which is out of happy endings. Beloved swam up from death, “where we cannot make sweat or morning water so the men without skins bring us theirs,” up through flowers and diamonds and iron circles, “up out of blue water.”

This is humbling. Of their mother, Denver says to Beloved, “Watch out for her; she can give you dreams.” The same goes for Morrison. It’s not enough to say that the writer who grew from strength to strength from “The Bluest Eye” to “Sula” to “Song of Solomon,” and who seemed to falter with “Tarbaby,” has written a splendid novel. “Beloved” belongs on the highest shelf of American literature, even if half a dozen canonized white boys have to be elbowed off. The thing is, now I can’t imagine American literature without it. Without “Beloved,” our imagination of the nation’s self has a hole in it big enough to die from.