Correction Appended

BERLIN— ''It is a new city,'' Mark Twain said of Berlin little more than 100 years ago, ''the newest I have ever seen. Chicago would seem venerable beside it.'' Outwardly this seems true today of central Berlin. The city is a forest of cranes, cavernous construction sites and a rising palisade of new Government ministries and imposing embassies (including the United States', not far from the Brandenburg Gate).

But the Berlin that Twain saw in 1891 had yet to make its mark as an intellectual and artistic center. It was Europe's third-largest metropolis, and its parks and boulevards were meant to express imperial grandeur, but the total effect was pretentious, as with the rows of marble statues of the royal Hohenzollern family installed in heroic poses in the Tiergarten. Even Kaiser Wilhelm II had doubts about his capital, remarking in a 1892 letter, ''Berlin is a great city, a world city (perhaps?).''

Remarkably, within a few decades Berlin burst up near the top as an acknowledged intellectual leader, especially in the sciences. In 1901, Sweden bestowed the inaugural Nobel Prize for medicine on a Berliner, Emil von Behring, for his serum against diphtheria. By the 1930's, no fewer than 29 Nobel laureates had been associated with Berlin University and its medical faculty, the biggest in Europe, at Charite Hospital.

Einstein's general theory of relativity, Planck's quantum mechanics and Heisenberg's uncertainty principle all came out of Berlin. So did the spectroscope, the discovery of radio waves and ''the magic bullet,'' salvarsan, to treat syphilis. Berlin's preeminence was ominously underscored in 1938 with the discovery of nuclear fission at the Kaiser Wilhelm Institute by Otto Hahn and Fritz Strassmann, building on the intuitive insight of Lise Meitner, who fled Berlin that same year.

The prestige of professors, including nonscientists, was immense; they were like film stars, everywhere recognized and deferred to. When the historian Theodor Mommsen rode a streetcar home, conductors always slowed down rounding his corner so he could appear to hop from the moving tram -- a blue-collar tribute to the no-longer-nimble professor.

This adulation had its downside. Professors became rabid nationalists, or ''Teutomaniacs,'' in the words of Alexandra Richie, author of ''Faust's Metropolis'' (Carroll & Graf, 1998), a full-length portrait of Berlin. To the self-appointed guardians of German culture, she writes, ''German virgins were more virginal, German loyalty was more selfless, and German culture was deeper and richer than that found in Paris or for that matter anywhere else.''

Germans are hardly alone in wondering (and worrying) whether Berlin, once more the capital of a united country, will again emerge as an imperious world city. Its intellectual future is similarly pondered.

Though the professor is still admired in Berlin, academic chauvinism is not. Professorial dogmatism has generally yielded to prudential caution, one reason being that not even the sagest German scholar foresaw the imminent peaceful downfall of the Berlin wall in 1989. Wolf Lepenies, the rector of the Institute for Advanced Study at Berlin, said in a recent lecture: ''The collapse of Communism is not so much a reason for triumph as a motive for modesty. Nineteen eighty-nine has shown us the narrow limits of expert culture.''

Nor has unification been a boon to the three universities in Berlin. Humboldt, Technical and the Free University are mired in financial crisis as government spending on higher education is being cut by a third. The ballooning costs of readying Berlin for its formal debut next year as federal capital is one reason for the squeeze, but the end of the cold war is probably the bigger factor.

Before 1989, Berlin's schools were extensions of political wars (Free University, for example, was founded in 1948 by students and teachers fleeing the Communist takeover of Humboldt, formerly Berlin University, in East Berlin). But the wall is now a memory, faculties are being reduced in size and free tuition is ending, propelling a wave of strikes among Berlin's 135,000 students.

An effect of these cuts is to widen further the gap in resources between Berlin's science faculties and those in the United States, the country of choice for gifted students in most of the world.

Still, Berlin is trying to make an intellectual mark with innovative postdoctoral institutes that are propagating eastward, a benign form of Germanic outreach. In this, Berlin has exploited its natural advantages: a tradition of research academies, strong links with Western universities and a location at the heart of what everybody now calls Middle Europe (from Berlin, it is one hour by car to the Polish border).

The heirloom among Berlin's 100-odd institutes is the Max Planck Society, successor to the Kaiser Wilhelm Institute, founded in 1911 and once the world's leading laboratory for scientific research. Since reopening its Berlin headquarters in 1993, the society serves as the mother church for 75 research institutes, including a score in eastern Germany reorganized on western lines (lubricated by $370 million in government money).