Nearly five years ago, I.B.M. embarked on an ambitious project to build a supercomputer, Blue Gene, to study protein-folding, a fundamental biological process. I.B.M. regarded it as a custom research program, useful for testing computing concepts but not a potential product.

Later this week, I.B.M. intends to announce its plans for a commercial version of the machine, Blue Gene/L. The company hopes to sell the machines, which would typically cost millions of dollars, to corporations that want vast amounts of computing power. Potential customers include oil companies that use geologic simulations to hunt for oil and gas fields, investment banks doing financial market and risk calculations and pharmaceutical manufacturers simulating how new drugs might work.

The power of the technology I.B.M. is bringing to the market place will be underlined today when the twice-a-year ranking of the world's 500 fastest computers is published. Two new Blue Gene/L prototype supercomputers are ranked in the top 10, as the fourth fastest and the eighth fastest.

More significant, the prototype machines represent a modest sampling of what the Blue Gene/L technology can do. The fastest supercomputers are usually vast racks of machinery, routinely described as requiring as much space as several tennis courts. The Blue Gene/L prototype machines are four refrigerator-sized consoles each.

A big Blue Gene/L machine that I.B.M. is building for the Lawrence Livermore National Laboratory should be up and running next year. According to I.B.M. and Livermore scientists, that machine should be as much as nine times as fast and one-tenth the size of the fastest machine today, the NEC Earth Simulator, used for weather and earthquake simulations in a Japanese government laboratory.

The performance of the Blue Gene/L prototypes is ''very impressive,'' said Jack Dongarra, a computer scientist at the University of Tennessee, who for years has maintained the authoritative list of 500 fastest computers.

The Blue Gene/L uses one-tenth or less as much power as most other supercomputer designs. Power consumption is an increasingly important issue in high-performance computing, because overheating adds to the cost of operation and degrades performance. Other major issues in supercomputing are floor space, peak performance, price and how to allot complex scientific applications across many thousands of microprocessors. ''With Blue Gene/L, I.B.M. has addressed all these issues,'' said Michel McCoy, leader of the advanced simulation and computing program at the Livermore lab.

The original focus of the Blue Gene project forced I.B.M. researchers to take an unusual approach. ''We found that if you really want to address grand challenge science problems, like protein-folding, you have to do things differently,'' said William Pulleyblank, director for exploratory computer systems in I.B.M.'s research division.

In broad terms, there are two kinds of supercomputers. The first, known as vector machines, use custom silicon processors; the NEC Earth Simulator is a vector design. The second is made by lashing together thousands of standard microprocessors; the most common are built from clusters of Intel or Advance Micro Design chips, of the sort used in personal computers.

In the last decade, the drift of high-performance computing in the United States has been toward cluster machines, using standard microprocessors. The Blue Gene/L design is a cluster machine, but instead of comparatively power-hungry personal computer microprocessors it runs on the kind of microprocessors I.B.M. supplies for video game consoles. Individually, the I.B.M. Power microprocessors are less powerful than today's fast PC microprocessors, but they are densely packed and linked by innovative hardware and software.

The cluster approach, using industry standard components, is less costly than custom-designed vector machines. The NEC Earth Simulator cost $350 million; the Blue Gene/L machine for Livermore will cost less than $100 million, though the national lab is getting a reduced price because it was a partner with I.B.M. in designing the machine. At Livermore, the Blue Gene/L machine, which will have 131,000 microprocessors, will initially be used to improve classified nuclear-blast simulations.

The commercial market for Blue Gene/L designs will require much smaller machines. I.B.M. says it has had serious discussions with two dozen companies, which it will not name. Google is quite interested, according to one industry executive, but has price reservations.

I.B.M. will also offer supercomputing as a pay-for-use service. Two supercomputing data centers, which will use Blue Gene/L machines, have already been set up in Poughkeepsie, N.Y., and Montpelier, France. A third center will be in Texas, but the location has not yet been determined.

''We think we can really drive down the cost curve for supercomputing,'' said David Turek, vice president for deep computing at I.B.M.

Photo: William Pulleyblank, I.B.M.'s director of exploratory server systems, and a researcher, Shawn Hall, with a Blue Gene/L prototype. (Photo by I.B.M. Corporation)