Cynthia Ozick, one of America’s most intelligent and serious novelists, has always mistrusted the novel. Perhaps only a writer of fiction knows just how morally ambiguous fiction can be, the way it encourages vices – dishonesty, voyeurism – that we despise in ordinary life. The clash between the pleasure of imagination and

the austerity of justice is especially troubling to a writer like Ms. Ozick, who claims her place in a Jewish tradition that strictly forbids the making of idols. As a secular American writer, Ms. Ozick reveres the masters of invention, James and Tolstoy; as a Jewish writer, she is troubled by the Talmudic dictum, “All that is not law is levity.”

This friction has provided the vital heat of much of her best writing, from her early novella “Usurpation” through her last work of fiction, “The Puttermesser Papers.” In “Heir to the Glimmering World” (Houghton Mifflin, 310 pages, $24), she once again sets truth and art into a complex dialogue, allowing each to critique the pretensions of the other. The result is not just a thoroughly intellectual novel but a witty and surprising one, constantly enlivened by Ms. Ozick’s sharp, even satirical eye for character.

The sharpest eye in “Heir” belongs to its narrator, Rose Meadows, a teenaged orphan with a precocious knowledge of human weakness. For this, and just about nothing else, she can thank her father, a scoundrel and liar of quasi-Dostoevskian shamelessness. Growing up with him in Depression-era Thrace, a fictional neighbor of upstate New York towns like Troy and Syracuse, Rose is reminded each year on her birthday that her mother had died in childbirth – a piece of cruelty rendered absurd by the fact that, as she discovers, her mother actually lived until she was three.

A childhood full of chaos and neglect turns Rose into a young woman obsessed with order: “My goal was utter straightforwardness: it made me prim and smug,” she acknowledges. This refusal to idealize her heroine is typical of Ms. Ozick, who has never cosseted her characters and always takes a particularly astringent view of domestic and romantic relationships. Rose does not expect or receive much kindness. Even her cousin Bertram, who allows Rose to live with him when she starts college and supports her when her father dies, eventually throws her out at the behest of his girlfriend, a communist firebrand named Ninel (Lenin spelled backwards).

Doubly abandoned, Rose takes a job as secretary to Professor Rudolf Mitwisser, a German-Jewish scholar whose escape from the Nazis has brought him, improbably enough, to a Quaker college in upstate New York. It is here, in the strange and unhappy Mitwisser family, that Rose receives her true emotional and intellectual education. Ms. Ozick draws a scathing portrait of these mandarin refugees, arrogant about their culture and nostalgic for their privileges, utterly unable to adjust to the democratic rough-and-tumble of American life. Only gradually does Rose, and the reader, come to under stand the suffering and fear that fuel their haughtiness.

The Mitwissers would not be able to survive in America at all were it not for the charity of James A’Bair, the unlikely millionaire who worms his way into their closed circle. It is in James that Ms. Ozick embodies her old suspicions about the morality of fiction, and in an ingenious new way. For James’s millions come from his father’s terrifically successful children’s books, in which he was portrayed as the lovable Bear Boy – a kind of American Christopher Robin, whose adventures with a talking hat have become world-famous. Yet his father’s books, which seem like tributes of love, are really acts of exploitation, and they ruin James’s life: “He understood that there would be no escape, he would always carry the mark of the Bear Boy, he would have to carry it into old age; when he was forty they would say of him, ‘Look at that fellow, he’s the Bear Boy all grown-up,’ and when he was seventy they would say, ‘That was the Bear Boy, can you imagine?’ ” Seldom can any writer of fiction have depicted with such piercing sympathy the bitterness of being turned into a fictional character.

This strange fate explains why James is so interested in Rudolf Mitwisser’s esoteric scholarship. Rudolf is a world-renowned authority on the Karaites, a Jewish heretical sect that preached an austere and literal brand of Judaism, rejecting the richly embroidered interpretations of the Talmud. The Karaites’ mistrust of human ingenuity echoes, a little programmatically, James’s resentment of his father’s inventions, as well as Ms. Ozick’s own long-standing suspicion of literature. On the surface, this shared intellectual interest explains why James is so happy to sponsor Rudolf’s researches. But really, Ms. Ozick shows, James enjoys being a benefactor because it allows him to manipulate the Mitwissers as coldly as any author manipulates his characters.

The only member of the family able to see through James’s generosity is Elsa, Rudolf’s mentally unbalanced wife. Ms. Ozick makes Elsa a former physicist and a colleague of Erwin Schrodinger – a rather incredible history, which leads to some of the novel’s least convincing passages. But in exile she has become neurotic and suicidal, and Rose’s wary relations with her deliberately echo those of Jane Eyre with the first Mrs. Rochester. The effects of Elsa’s mental illness on her children are portrayed with painful verisimilitude – as is Rose’s resentment at having to step into her maternal role, when all she really wants to do is help the professor and learn about the Karaites. In showing how the demands of family can stifle women’s intellectual lives, Ms. Ozick offers a powerful feminist insight.

Nothing about the Mitwissers, James, and Rose makes it likely that their story will have a happy ending. And while Ms. Ozick brings the novel to what seems like a Jane Austen-style conclusion – complete with a marriage, a birth, and an inheritance – each of these rewards comes with a twist, and at a price. By the last page, only Rose seems headed for a brighter future, as she sets out for Manhattan with the Sun want ads under her arm, having won what Ms. Ozick suggests is the only prize worth having: her independence.