THE WATERS OFF KEY WEST, WITH their dark history of piracy, make an apt setting for major powerboat racing. Some modern-day pirates are drawn to the sport, and two of them were absent -- though not exactly missed -- from last week's World Offshore Championships. George Morales, a Colombian who was the 1983, '84 and '85 Superboat champion, is serving 16 years in Miami for cocaine smuggling; Ben Kramer, the 1986 national Open Class winner, is facing trial in Illinois on charges of marijuana smuggling. What did turn up was the best field in U.S. offshore racing history, including 15 foreign teams among the 23 entries in the Open Class. Key West presents a particular challenge to offshore racers. The union of channel and ocean waters can create choppy waves and complicated currents that severely test the skill of a crew and the strength and design of a boat. Two crewmen were killed in 1985 and one in '86 when their boats stuffed -- plunged into waves -- and were crushed by the force of the water. This year many of the boats were fitted with bulletproof plastic canopies over their cockpits. One such boat was the 36-foot catamaran Thriller, which lived up to its name as it hit a wave at 115 mph, did a barrel roll and skimmed along upside down for several seconds before landing upright with the crew unscathed. ''If it weren't for the canopies we'd be dead right now,'' said Thriller throttleman Jack Clark. The Union of International Motorboating, which is based in Belgium, bestows its sanction and prestige on the Open Class of boats, which may be catamarans or deep V's, 30 to 50 feet long, and have a maximum engine displacement of 1,000 cubic inches -- 2,000 for diesels. The American Powerboat Association favors its Superboats Class. These are from 35 to 50 feet long, and the largest can have as many engines of as much size and power as their owners care to install. The international body considers Superboats a testament to American mechanical excess. The defending Superboats champion, Al Copeland, 43, the Popeyes Famous Fried Chicken & Biscuits tycoon from New Orleans, may be testimony to American culinary excess. Copeland's canary-yellow 50-foot Cougar catamaran, Popeyes, was not the fastest Superboat off Key West, however. That honor belonged to the $1.2-million white-and-gold Gentry Turbo Eagle, a wooden-hulled, 48-foot Cougar cat with four turbocharged engines, each of which produces nearly 1,000 hp. Its owner and driver, Tom Gentry, a semiretired Honolulu real estate developer, has been racing and winning for more than a decade. In New Orleans in March he set the offshore powerboat world speed record of 148.283 mph. In fact, he got Turbo Eagle up to 157 mph on a follow-up run but suddenly thought again. ''In the middle of the run I turned chicken,'' he said last week. ''Well, maybe chicken isn't the word. Let's say I exercised caution. The boat has a lot more in it now.'' The Open Class featured a contingent of eight Italian boats, which matched the number of American entries. The Italians had dominated this year's European circuit, winning 11 of 13 events. They were led by Fabio Buzzi in his unique Luchaire, a 44-foot deep V with four turbocharged diesel engines and a giant upturned wing behind the cockpit that made the boat look like a flying nun in a bright red habit. The apple in the Open field was a freckle-faced Briton, Steve Curtis, 23, son of marine designer Clive Curtis, founder of the Cougar boatbuilding company. Steve had been a top motocrosser before switching to boats four years ago, and he brought a fresh exuberance to the scene. He dressed for Saturday's race in striped surfer jams and a sleeveless Union Jack shirt, with a light stubble on his chin and yellow zinc oxide on his nose. The championships in each class were determined on points over three races: 90-milers on Tuesday and Thursday and a 149-mile finale on Saturday. In the Superboats, Al Copeland's Popeyes won the first two races, while Tom Gentry's Turbo Eagle placed third and second. But in the finale Gentry's smaller but faster yellow cat left Popeyes dead in the water to win the title. In the Open Class, Curtis's 41-foot catamaran, a Cougar named Cougar, also took the first two races. In the finale Curtis planned to hang behind the leaders and win on points. ''They'll all be going flat out because they've got nothing to lose,'' said Curtis. The start of an offshore powerboat race is a considerable spectacle. Luchaire moved from the middle into the lead. But within minutes the big red boat began polluting the clear sea with an ugly trail of diesel fuel as a blown turbocharger knocked out one of Buzzi's engines. Cougar passed on the inside of a turn on the second lap and Buzzi glanced over, knowing he was history. The trick to handling a catamaran in rough water is to skip over the waves, which requires courage, sensitivity and constant quick adjustment by the throttleman. The driver merely steers, taking his direction from the navigator. But the throttleman holds the magic wand. Cougar's throttleman, Justo Jay, had the black cat howling as she soared over the one-to three-foot swells sprinkled with whitecaps. But after one of Cougar's four engines swallowed some seaweed along with its cooling water, it began to overheat. Jay pulled the throttle back, and Cougar was passed on the final lap by an Italian boat, Rainbow. Curtis's 81.95-mph average in the finale was well below the 93.93 he had reached earlier in the week, but he easily took the title on points. The jubilant Curtis became the first Brit to win an Open world title, and the champion's first postrace happening was to get thrown into the water. At least he was dressed for it. As for his future, he wasn't really ready to speculate. His plans were more immediate than that. ''If I survive tonight, then I'll think about next season,'' he said.