BY DESIGN : A Working Woman’s Woman : She tried selling couture but hated it. So Diane Von Furstenberg is sticking with affordable clothes for real women.

Ensconced in the Beverly Hills home of her best buddy, media mogul Barry Diller, Diane Von Furstenberg is ready to talk--immediately.

But not in this room, it’s too dark. So she suggests a move into a sitting room off the veranda. Sunlight streams in, the sofas are dangerously cozy, the color scheme flatters Von Furstenberg’s mint-green and gold ensemble. Yet she is not quite satisfied--it doesn’t smell right. She politely asks the manservant for one of the scented candles from her Surroundings fragrance line; he also brings in a vase of fresh yellow roses.

This is the essence of Diane Von Furstenberg. Her total sensuousness--sometimes conveyed as passion, other times as empathy--has helped drive Von Furstenberg to international fame. She’s a woman’s woman who, like Martha Stewart but without the Yankee imperiousness, appeals to the part of us that would love to make where and how we live beautiful.

This is the woman who parlayed a desire to be comfortable and chic into the 1976 wrap dress that launched an empire, then signed that empire away to licensees in 1983 to pursue her love of books. This is the woman who produced coffee-table books celebrating the delights of beautiful beds and soothing baths. And this is also the woman who ultimately rejoined the fashion world in 1990 because she was embarrassed by the products being made under her name.

Von Furstenberg’s efforts to regain her label’s luster are paying off rapidly. She has already made her mark on QVC, turning the once-dowdy cable shopping channel from coal to diamond by generating mind-boggling sales of her Silk Assets apparel line ($1.3 million in two hours). She has since added the Surroundings aroma-therapy line and a collection of knit separates. Now, Von Furstenberg is launching the Color Authority, a sportswear line for Avon.

Von Furstenberg says she has always been fascinated with Avon’s sales methodology. “Your best salesperson is your customer, so they had a great idea when they first started,” she says. “Also, they gave an opportunity for women to make money on the side.”

She will design one collection for the firm four times a year, and the cadre of Avon Ladies, who number almost half a million, is being encouraged to wear the label. The line appears in brochures published this month.

The 10-piece collection includes knits, silks and a few accessories. Prices range from $20 to about $50. Among the highlights are an oversized cotton blouse with a convertible collar and a knit cardigan in black-and-white plaid. In fact, even though the Color Authority collection conjures images of vibrancy, its predominant colors are black and white.

The idea, Von Furstenberg says, is to create a wardrobe that can be built upon. “Black and white is a very good canvas,” she says. “Black and white and color looks so beautiful. And I consider black and white a color.”

Partnering with the gray lady of direct marketing also suits Von Furstenberg’s new philosophy. “The people in my office make fun because I always say this, but . . . the closer we can get the sewing machine and the cash register together, that’s the best value we can have.”

When planning her re-entry, Von Furstenberg noted that such specialty stores as the Gap and Victoria’s Secret were winning customers because product goes from factory to store, leaving out all the middlemen that add up to higher retail prices. Consequently, she now works only with firms that have their own distribution arrangements.

For Von Furstenberg, making clothing for the masses has been a mission of sorts.

“I think that’s where I can make a contribution. What I think is more fun and more challenging is to be able to give nice clothes that a lot of people can wear. For a while, a very short time, I had a store on Fifth Avenue and I did couture clothes and I hated it. Nothing is worse than selling to rich people, I think.”

But that doesn’t mean quality has to suffer. Von Furstenberg can barely say the word cheap. It falls from her lips reluctantly, and she cringes as if an odor has been emitted.

“I know what I like and I like to stand behind what I like,” she says. “I can’t sell what I don’t like because then I lie.”