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In the shadow of the Acropolis, Greeks are witnessing a scandal-plagued showdown -- involving allegations of drug-dealing bishops, bribe-taking judges and a mysterious fugitive -- that could permanently sever the ancient bonds of church and state.

A series of stunning revelations has uncovered what seems to be a powerful criminal element within the leadership of the Greek Orthodox church. Run by bishops accused of serious crimes, the ring is reported to exert control over Greek politicians and judges, and to have used the church's almost unlimited powers to build a mafia-like hierarchy of wealth and corruption.

This week, the scandal threatened to reach the very top of this secretive church. Archbishop Christodoulos, the 66-year-old leader of the church, has been accused of working with a convicted drug smuggler named Apostolos Vavilis, who is wanted by Interpol and believed to be hiding in Italy. The archbishop said this week that the relationship is innocent, but police want to question Mr. Vavilis about his role in the church, where he allegedly acted as an envoy at the highest levels.

The church, which for decades has seemed immune to criticism, has begun to be shaken. During the ceremonial inauguration of a new Greek president on Saturday, half a dozen members of parliament stormed out of the legislature, and dozens more refused to stand, when the archbishop entered the chamber in his ceremonial headdress and carrying his sceptre.

"These are issues which must be confronted," MP Fotis Kouvelis, one of the six who walked out, said in an interview in his office earlier this week.

"We believe the church has delayed in confronting these corruptions -- consequently, there is a responsibility in the hierarchy of the church to answer for these events . . . for us, the only answer is a severance of the powers and responsibilities of the church from those of the state."

A majority of Greeks now believe that the archbishop should resign, according to a poll this week, but it will not be easy to transform a church that is older, and in many ways mightier and wealthier, than the modern Greek state.

The Orthodox Church is a state religion, its 10,500 priests and 10,000 theologians paid government salaries similar to those earned by high-school teachers. Its 81 bishops are far more powerful, earning tax-free salaries similar to those of cabinet ministers and at least twice again that much from fees for weddings, baptisms and funerals, from the rental of burial plots and from the construction and renting of apartments on church property (which is legal).

But for a highly placed group of bishops, it appears that these powers are not enough.

The scandal began last month, when Bishop Theoklitos of Thessaliotis resigned after being accused of running a trial-fixing ring; four high-court judges and several politicians were allegedly paid large sums of money to clear the bishop and his associates of charges that included drug dealing and homosexuality (which is illegal in the church).

The scandal quickly spread to the highest levels of the church. Another bishop resigned after he was accused of have secretly laundered $17-million (U.S.), believed to have been earned by selling church property, and banking the money in U.S. accounts. A third resigned over stories of wild sex escapades involving prostitutes. Newspapers ran photos of a 91-year-old bishop naked in bed with a young woman. He has refused to resign.

A further eight bishops are under investigation for crimes including smuggling, bribery, money laundering, drug dealing, pedophilia, prostitution and sexual harassment.

This week, the 2001 election of the current patriarch of the Jerusalem branch of the Greek church (which is the second largest landowner in Israel) was illegal because it had been rigged by Mr. Vavilis and other "known criminals" sent to Israel by Archbishop Christodoulos.

The archbishop was the chosen candidate of the ultra-conservative Chrisopigi Brotherhood, an order whose role is similar to that of Opus Dei in the Roman Catholic church. Previously, Orthodox archbishops had pledged to reform the church, in an effort to distance it from its support of the Greek military dictatorship that ruled from 1967 to 1974, and to account for the church's vast land holdings.

After his election by the church's Holy Synod in 1998, Mr. Christodoulos and his backers pledged to purge the church of modernizers. He has become intensely involved in politics, issuing statements on the Kosovo war and Greece's membership in the European Union, and successfully lobbying the government to have citizens' religious affiliations printed on their national ID cards. The church landholdings remain secret and unregulated.

That has led a growing number of theologians to argue that the church has become a rogue force, beyond the control of government or its own members.

For his part, Archbishop Christodoulos has argued in sermons and speeches this month that the church is a victim of the forces of globalization, which he says are out to make Greece like other European nations.

"This is just a tactful way of marginalizing the church," he said in a statement. "They want to make civil weddings compulsory . . . and legalize same-sex couples. Suddenly, church land is in question, and now all this? Is it a coincidence? . . . If those that are attacking me think I will resign or that I will stop talking, they are deeply misguided."