By day it is just another dirty doorway with a canopy to keep the hot sun off some of New York's shadier characters. But by night it becomes a portal to a nonstop celebrity party for the ritzy, the glitzy and even a few moonlighting mortals. This is the Underground, the dominant disco in Manhattan these days and the closest thing to Studio 54, which shut its doors last year after owners Steve Rubell and Ian Schrager went to jail for tax evasion.

By midnight on any Friday, the best night for celeb watching, they begin to arrive at Broadway and 17th Street: The well-heeled alighting from limos are ushered in, the others clambering from subways are kept waiting for up to an hour before being allowed to pay a $15 cover charge and wander through the crowd sprinkled with celebrities.

One night recently patrons looked on in awe as Polly Bergen hosted a bash for Henry Mancini. Among the glitterati were Carrie Fisher smooching with Paul Simon, and Carrie's dad, Eddie, flaunting his Vegas tan. Another evening the Underground's main feature was Beverly Sassoon's 32nd-birthday party for her squeeze, Erik Estrada. John and Mackenzie Phillips, Donald Sutherland and Bianca Jagger trundled in for that. Christopher Reeve and John (The Deer Hunter) Savage have made the scene. The reclusive Robert De Niro has sidled in with actor Joe (Raging Bull) Pesci. Elizabeth Ashley, who lives in the neighborhood, sometimes drops by. And Mary Tyler Moore comes late—after 2 a.m.

Couples snuggle in gray plastic chairs barely big enough for two. Fans try to slip past the bouncer into a VIP room, while more passive types gape at the deejays. The real action is underground—on the downstairs dance floor crammed with couples both gay and straight. The walls are bare brick, highlighted by flashing red and blue neon and mirrors. Nearby is the coed restroom where people powder their noses—in more ways than one. A variety of drugs are consumed at the Underground, as at most hot spots, but the owners insist that they try to keep those substances controlled. For those in search of less chemical pleasures, there are three bars and the Grotto, a comfy and quieter room so dark that necking couples are often mistaken for pillows. The dungeon-like SM flavor of the place is enhanced by chains and leather bracelets on the walls, left over from days when the Underground was strictly a gay bar. "There are so many cozy niches," Polly Bergen gushes, "that you can have your own private party going on while everyone else is milling around."

Curiously, the owners of the Underground—Karl Crnobori, 39, and Herb Natiss, 42—bill themselves as low-profile family men. "We enjoy meeting people," concedes Natiss, "but it doesn't matter if they are celebrities. Maybe that's why they like the place; they don't feel victimized." Crnobori daylights as an interior decorator and Natiss owns an air-conditioning business. They took over co-management of the club last fall, hoping to reach beyond the Underground's gay constituency by staging concerts and parties to lure VIPs. Then local cable-TV hostess Nikki Haskell hit on the notion of inviting her pals—Christina Onassis, Calvin Klein and Francesco Scavullo among them—to the Underground for dinner. She interviewed some of them live after dessert. The club's cachet with the jet set soared. "When the TV lights go on, people go crazy," explains Haskell. "Everyone wants to be on TV, even if they say they don't."

The ultimate question is whether the Underground is not already on its way to becoming passé. "The real test," declares one jaded partygoer, "is whether a club can get through the summer." If so, come September the Underground will face its stiffest challenge yet, when new owners plan to bring Studio 54 back from the grave.