Smog blots out the sun. Factories dot the shores. And the construction of a giant dam has flooded the Three Gorges, the famed river passage through towering limestone and sandstone cliffs.

And yet, one afternoon last spring, a friend and I were staring in quiet wonder from a cruise ship sailing up the Yangtze. We were in a world of green, gliding past cliffs covered in rain-slicked trees and bamboo bushes. Slender waterfalls churned into the jade-colored river.

"It is really beautiful. I can only imagine what it would be like on a clear, blue-sky day," said my friend, Maria Ines. "But even like this, it's magical."

Since 2003, the massive Three Gorges Dam near Yichang has plugged China's largest river. That created a reservoir expected to gradually fill over six years, driving up water levels more than 350 feet. Many people fear the ruin of one of China's iconic landscapes.

By the time we arrived at the Yangtze, about three-quarters of the flooding had occurred. More than 1,000 towns and hamlets had been submerged.

And yet, the Three Gorges were still stunning.

"Of course it's disappointing" that so many villages are gone, said Raynor Shaw, a geologist and author of Three Gorges of the Yangtze River. But, with the mountains soaring more than 3,000 feet, "it's still a gorgeous place."

The Yangtze is no typical cruise experience. The river offers a panorama of beauty and ugliness, old China and new. We'd float through bucolic terraced farmlands, only to round a bend and confront 30-story office towers wrapped in gauzy haze.

Even choosing a cruise line was an adventure. Wary of the creaky, rat-infested tubs that some tourists have encountered, we selected the Orient Royal line. The Chinese-run line was a little pricey, at nearly $800 per person for the four-night cruise upstream from Yichang to Chongqing. But the firm boasted of a roster of rich American clients.

"Why not choose what Bill Gates chose," its Web site asked.

Arriving at our ship, we wondered what had gotten into the world's richest man. The East King's decor was an exuberance of gold and red, all swirling carpets and flocked wallpaper, with the well-worn feel of an old Holiday Inn.

Still, the ship was spotless. And the cruise turned out to be a relaxing way to see a country fast-forwarding out of Maoist isolation.

Entering the first of the gorges, we looked out on misty mountains dotted with small, pink farmhouses. In the soft gray of morning, everything felt dreamy.

"What color is the river? It's green like jade," said the Chinese guide, in her singsong English. That was no hyperbole. Spring is perhaps the best time to visit the Yangtze, before the rainy season's mud has stained the river.

For 40 minutes, our ship zigzagged past rock walls folded and fluted like curtains. Some rippled with mineral stripes of tan, gray and black; others were carpeted with thick green scrub, banana trees, and ramrod-straight pines. Rocks jutted out in all kinds of formations: fingers, knobs, bulges.

At times, the mountains soared majestically. Then the passages would narrow, and we'd feel a sense of intimacy with nature.

And then it was over.

Suddenly, we were back in the modern world, with chunky white apartment buildings springing from the shore like a giant Lego project. A bridge buzzed with traffic. Workers plinked away at a shipyard.

"You have reached the real China," a guide told us. She was referring to the traditional landscape, but the reality of China is pell-mell development, even in the heartland.

Even in the quiet of the gorges, we were rarely alone. About a billion tons of cargo travel the Yangtze each year, making it one of the world's busiest waterways. A parade of barges slipped by, carrying hills of coal, a reminder of the country's huge power demands.

The Three Gorges Dam is aimed at helping satisfy that appetite for energy. When finished, it will generate 20 times as much electricity as the Hoover Dam, offsetting some of the need for smelly, polluting coal. Chinese authorities also hope it will help control deadly floods on the world's third-longest river.

After lunch, we boarded a bus to view the concrete behemoth. The dam is typically described in superlatives: It's one of the biggest public-works projects in history, longer than the Brooklyn Bridge and higher than the Washington Monument.

But when we reached it, we must have looked a little underwhelmed.

"Maybe it's a little different from your mind?" fretted our Chinese guide, Stephen.

If the dam's appearance wasn't as dramatic as we'd expected, its impact is huge. As our guides explained, the government is relocating 1.3 million people from towns submerged by the rising waters.

Clusters of sterile white apartment buildings are rising along the Yangtze for the displaced. Traditional market towns have vanished. At one point, we glided by a graceful, old wooden temple at the river's edge.

"In 2009, that will be under water," the guide said.

It was difficult to get a sense of the human cost of such dislocation. Our Chinese guides shrugged it off, saying that only the elderly objected. They insisted that younger residents were happy to be part of China's boom and welcomed their bigger, government-built apartments, with plumbing and access to supermarkets.

Deirdre Chetham, author of Before the Deluge: The Disappearing World of the Yangtze's Three Gorges, said many young people in the cities and large towns did indeed welcome the move. Though the old towns had architecturally interesting old quarters, they also were filled with crowded, Soviet-style concrete apartment buildings from the 1950s and '60s.

But for rural families, the move was more traumatic. "They lost the land they had tilled for generations," Chetham said. "Large numbers of people were moved as far as 1,200 miles away."

Our guides' sanguine attitude was perhaps not surprising; they were all Communist Party "team members." They also cheerfully dismissed environmental concerns about the river, assuring us that endangered fish and birds were bouncing back.

Yet, even the guides had to acknowledge the yawning gaps between government propaganda and the vibrant, Western-obsessed country we were observing.

One day, a guide pointed to satellite dishes sprouting from a few farmers' houses. The government didn't allow them in urban areas, she explained, since residents might "learn the reality about the Chinese people" from English-language TV.

The East King offered a glimpse of the increasingly capitalist China.

The four-story ship could carry 192 passengers, all in outside cabins with large windows, TVs, comfortable beds, and decent-size bathrooms. Its spa offered foot rubs and "aromatic rose massages," and the bar served Australian wines. Onboard activities included a dumpling-cooking class and the inevitable karaoke. Crew members were unfailingly polite.

Food was plentiful. A breakfast buffet featured offerings from toast and eggs to Chinese noodles; dinner brought a procession of Chinese dishes, such as steamed buns with ground pork, chicken in lemon sauce, sweet-and-sour fish, and a variety of vegetables (including a spectacular dish of radishes in orange sauce).

There were occasional lapses. At lunch, the chefs did their best imitation of American food, which is how I came to be served a nice chicken cordon bleu - slathered with tartar sauce.

But the ships have come a long way from the days when rats shared the cabins. And in recent years, the Chinese have done some cleanup on the Yangtze. It's still polluted, but I saw none of the river-borne trash common in the past.

That's not to say the cruise is as dramatic as it once was. Among the 40 passengers - Americans, Canadians, Europeans and a few Chinese - were some San Francisco residents who recalled the cliffs soaring higher when they'd visited pre-dam.

Even one of the shipboard guides admitted sadly, "So many beautiful sceneries have been flooded away."

And yet, no one thought the gorges were no longer worth visiting.

"For someone who's never been before, they're still pretty stunning," Chetham said.

The highlight of the cruise came on the second day, when we took a side trip to an area known as the Lesser Three Gorges. In a driving rain, we boarded a small ferry to putter up the emerald Shennong Stream, between mountain walls lush with green bamboo bushes, leafy trees, and a sprinkling of yellow flowers.

As the water got shallower, we switched to small wooden craft called peapod boats, resembling wide canoes. Powering them were short, sinewy men in shorts - the storied boatmen of Shennong, who had pulled boats through the clear, rapids-filled water for centuries, traditionally without benefit of clothing. Thrusting their oars in the water, the men looked like wizards in their pointy-hooded rain ponchos.

Despite the boats' makeshift blue tarp roofs, we quickly became soaked. But we became almost giddy as we retreated into a quiet, green-tinged world. We finally had the river to ourselves, with just the occasional farmer gliding by in a sampan. And for once, the air was fragrant and clear.

"There's no pollution" in the tributary, said our guide, a member of the Tujia ethnic group. "If you wash your face, you may become younger and more beautiful."

As we headed back to our cruise ship, one of our boatmen began to sing a traditional, haunting melody in the local language. His reedy voice carried along the river, silent except for the rhythmic whoosh of oars. It seemed we had caught a glimpse of the old China so rapidly being obscured by modernization.

And then I realized that, unlike his colleagues, the boatman wasn't wearing a typical straw hat under his rain poncho.

He sported a Yankees cap.

Sailing the Yangtze River

Starting next year, U.S. Airways plans to fly nonstop to Beijing from Philadelphia International Airport. Until then, you can make the flight with one stop on Air China, British Airways, Lufthansa and United. The lowest recent round-trip fare was $984.

From Beijing, the two-hour flight to Yichang costs $160 to $200 one way on Air China or Hainan Airlines. (In China, one-way tickets are typically

half the cost of round-trip.) In general, it's cheaper to book Chinese domestic air trips once you're in the country, but it's wise to book the Yichang flight well in advance, since there are only one or two nonstops each day.

Our cruise line sent a driver and English-speaking guide to pick us up at the Yichang airport, and another team delivered us to Chongqing Airport.

Americans must have Chinese visas, which can be obtained from the Visa Section of the Chinese Embassy at 2201 Wisconsin Ave. NW, Suite 110, Washington, D.C. The fee is $100. For details, go to www.china-embassy.org. Passports must have at least six months of remaining validity.

Cruising

The best times to cruise the Yangtze River are in the spring and fall, when the weather is cool and comfortable. The river valley can be broiling in the summer. Some cruise lines don't operate in the winter.

Upstream cruises tend to take longer and are less popular - but they're also often cheaper and less crowded.

We traveled with Orient Royal (www.orientroyalcruise.com), which gave us a 10 percent discount for booking online. Because of Chinese banking regulations, though, we couldn't pay by credit card and had to wire the cash from a bank. Our four-night cruise upstream cost $792 per person, which included meals, shore excursions and airport transfers. Once on board, we decided to spend an extra $100 each to upgrade from a bottom-level cabin to one on the fourth floor with nicer windows and better views.

Other lines offering Yangtze cruises include Victoria (www.victoriacruises.com) and China Regal (www.chinaregalcruises.com). Viking (www.vikingrivercruises.com) claims to operate the most luxurious ships on the river, but its cruises are open only to travelers who take its package land tours.

More information

China National Tourist Office

www.cnto.org

- Mary Beth Sheridan