August 31, 1981

The 67-year-old man had lymphoma, a form of cancer. The disease was tightening its grip, attacking his skin and his lymphatic system. Chemicals and radiation were failing. Then his doctors started a new treatment with substances called monoclonal antibodies designed to seek out his cancer cells exclusively and help kill them. These special antibodies, the most potent biological ''guided missiles'' known to science, were given repeatedly while the doctors watched for signs of dangerous toxicity from the new treatment. There were no such signs. By the end of four weeks the man was looking better and feeling better. Some tumors on his skin disappeared; others became soft and flat, signs that they were being attacked. The patient's fevers and night sweats ceased. A medical report described the response as encouraging.

In their first confrontation of the Democratic mayoral primary campaign, Mayor Koch and Assemblyman Frank J. Barbaro disagreed heatedly yesterday about whether the Mayor had saved the city from fiscal insolvency and whether the city should grant tax abatements to real estate developers. ''He did not save the city from bankruptcy,'' Mr. Barbaro asserted several times during a televised exchange in which all three Democratic mayoral candidates appeared. The Brooklyn Assemblyman also accused the Mayor of giving ''$700 million to real-estate people and then taking thousands from them in contributions.'' Recalls Warning by Rohatyn The Mayor quoted a warning made in January 1978 - just after he took office - by Felix G. Rohatyn, then and now the chairman of the Municipal Assistance Corporation, that the city still faced a perilous fiscal situation.

An article in Metropolitan Report on Friday incorrectly described the pub- lic schedule this summer of Senator Harrison A. Williams Jr., Democrat of New Jersey. Senator Williams has been making speeches, attending pub- lic functions in his district and per- forming various constituent services.

The New York City school system, under court order to accommodate handicapped children of all kinds, is grappling with one of the most complex challenges it has faced. It must confront long waiting lists, a shortage of qualified teachers and resistance from superintendents, principals and others who would prefer to devote their limited resources to those who are not handicapped. As the school term that begins Sept. 10 approaches, the school system has a waiting list of 12,684 children who are by law entitled to special programs but either have not been evaluated or have not been placed. Others have been placed in the wrong kinds of classes or not integrated in classrooms with children who have no handicaps, as mandated by Federal law.

Chase Manhattan announced it was abandoning its 40 percent interest bonus for investors who sign up early for the new ''All Savers'' certificate program. The development came after an unusual warning by the Internal Revenue Service over the weekend that the bonuses might not allow savers certain tax deductions. (Page A1.)