The 20th century was not especially kind to Washington Irving, whose satirical humor once earned him worldwide acclaim. The darker visions of Melville, Hawthorne and Poe now loom larger in the American literary pantheon. Although Governor Spitzer referred to Rip Van Winkle in his inaugural speech last week, only about a third of the university-educated born after the 1960s can identify the character who slept 20 years on a hill overlooking the Hudson.

In “The Original Knickerbocker” (Basic Books, 346 pages, $26.95), Andrew Burstein has awakened Irving’s legacy from slumber to reach a new generation of readers. How great was Irving’s contribution? A creator of a particular national literature is hard to size up when one could be too much his heir. The Salmagundi sketches attached the name “Gotham” to New York, and Irving’s mock chronicle “A History of New-York from the Beginning of the World to the End of the Dutch Dynasty, by Diedrich Knickerbocker” affixed the word “Knickerbocker” as meaning “a descendant of the original Dutch settlers of the New Netherlands, hence, a New Yorker” (Oxford English Dictionary). Knickers as a term for loose-fitting breeches, the basketball team name “the New York Knicks,” and the popular image of a jolly, pipe-smoking St. Nicholas all bear his influence.

By lampooning the young nation, he put literary New York on the map. Irving’s whimsical account of New York’s founding “ridicules the gravity of history as taught by men of substance,” writes Mr. Burstein of the University of Tulsa. Launched by a publicity stunt, the book has comic scenes such as Pieter Stuyvesant using his peg leg to club a governor and the gods taking leave of battle to step “into a neighboring tavern to refresh themselves.”

Today’s New Yorkers, accustomed to brash behavior, may smile at Irving’s boast that his book is “the only Authentic History of the Times that ever hath been or ever will be published.” His approach was to “overdo everything while keeping a straight face, and always pretend to be bigger than you are,” notes Mr. Burstein, who summarizes his achievement squarely: The 26-year-old Irving “served up nervy nonsense,” peeling away “layers of so-called polite society.” Irving succeeded so well that “his New York would become known as Knickerbocker New York.”

That Dutch name would come to describe a school of writers whose sophisticated banter combined sentiment with cheerful irony to critique politics and society. As Thomas Bender observed in “New York Intellect”(1988): “The contrast with Boston is striking. Instead of ethics, philosophy, and theology — instead of thought — we have light, sophisticated wit, satire, and burlesque.”

Deflating America’s self-importance and imagining lovable vagabonds and other desultory characters, Irving injects a little levity while projecting the reader headlong into a dim past. Wistful nostalgia permeates the tale of “Rip Van Winkle” as well as the “The Legend of Sleepy Hollow” where scarecrow-bodied Ichabod Crane encounters a headless horseman (“huge, misshapen, black and towering” while “muffled in a cloak”) seeking to be reunited with his lost head. No matter that Irving borrowed from German tales in creating American folklore. Less important are what sources Irving made his tales out of than what he made them into, Mr. Burstein avers.

The author of previous biographies of Andrew Jackson and Thomas Jefferson, Mr. Burstein combines masterful descriptions of Irving’s political background (he was a supporter of Aaron Burr), lucid analyses of literary characters (Rip and Huck Finn are industrious America’s “innocent mischief makers, lost souls”), and discussions of publishing history.

Churning out eclectic literature under his own name and pseudonyms such as Jonathan Oldstyle, Geoffrey Crayon, and Diedrich Knickerbocker, the genteel Irving is paradoxical: a convivial loner who mixed widely in transcontinental travel, a bachelor who “idealized family,” a recipient of honorary degrees from Columbia and Oxford despite never graduating from college. Irving was arguably the first American to earn his living as an author, producing commercially successful books as the family business failed.

He wrote romantic accounts of Spain and the American frontier, as well as biographies of novelist Oliver Goldsmith and President Washington.

Irving met literary notables of his day: Sir Walter Scott limped up the hill to greet him, fresh-faced Bowdoin graduate Henry Longfellow arrived in Madrid, and young Charles Dickens proved somewhat disappointing in New York. James Fenimore Cooper, to whom Irving is often compared, coolly kept his distance. Irving hobnobbed with nearly every American president of his time, secured diplomatic appointments in Madrid and London, where his legal training likely helped. He aided in negotiations over the Oregon Territory.

This reviewer’s only cavil with the biography is its occasional unnecessary foreshadowing (“but that, too, was yet to come,” “this will become more apparent as time progresses”).

As it would turn out, Irving’s future lay at Sunnyside, his Hudson Valley home, where he enjoyed bird watching and kept a pet pig named Fanny. He would graciously greet tourists who had traveled to see the famed author’s house. But when the mail brought appeals for autographs and other requests, he grumbled to his nephew, “I wish there were no post office.”

Upon being asked to be included in a noted publisher’s “Repository of the Lives and Portraits of Distinguished Americans,” Irving replied, “Were I even vain enough worthy a place in the biographical work you propose, I should decline the hazardous honour for I would rather that ninety nine should ask why I was not there, than incur the possibility of one persons asking why I was.” Mr. Burstein’s new portrait of this distinguished American removes all doubt whatsoever about Irving’s rightful place.