PHILADELPHIA THE Philadelphia Craft Show, which runs tomorrow through Sunday, is only in its fifth year but has already endeared itself to the artists who exhibit in it. ''This fair is the nicest one,'' said Nancy Clearwater Herman, a quilter whose work has been in shows and galleries all over the country. ''It's not that big, so you feel important to get into it. Also, this place is the nicest.''

''This place'' is Memorial Hall in Fairmount Park, built for the Centennial of 1876 and used by the city for special exhibitions. It has a huge rotunda with a glass dome, marble floors and classical statuary - a far cry from temporary tents and drafty hangars.

Just 110 artists were chosen this year from 1,000 applicants. Selections were made by a jury that included Joan Mondale, Jean Sutherland Boggs, drector of the Philadelphia Museum of Art, Paul J. Smith, director of the American Craft Museum, and Wendell Castle, the wood artist.

The show is run by the Women's Committee of the Philadelphia Museum of Art. ''We wanted a fund-raiser for the museum,'' said Mary Lee Lowry, coordinator of the show, ''but everyone in Philadelphia was doing everything else - the dances, the horse show, the flower show - so we thought of this.''

The invited craftsmen pay $175 each for a space approximately 10 by 10 feet, plus $7.50 for processing slides used by the jury, but they retain anything made on sales. Guests at the preview party pay $35 each. Visitors to the show are charged admission -$4 for adults, $3 for students, $2 for children and the elderly.

''Our aim,'' Mrs. Lowry said, ''is to present the finest new artists in the country. We tell the jurors that we're not trying for a balanced show, so just pick the best even if they're all ceramicists or all glassblowers.''

There are more ceramicists this year than anything else - about 30. There are also two dozen woodworkers and almost that many jewelers. Other categories are workers in baskets, candles (one exhibitor), fiber, glass, leather and metal. Most of the participants work on the East Coast, but some are from the Middle West and California. ''We had an inquiry from Bali this year,'' Mrs. Lowry reported, ''but he never sent in an application.''

''Since the judging is done anonymously,'' Mrs. Lowry said, ''we're sometimes surprised by who does or doesn't get accepted. One year a quite well-known artist was rejected while a man who made brooms was accepted. This year we were surprised to see Bob Ingram. He's had gallery shows and been exhibited in Europe, but this is his first craft show.''

Mr. Ingram, a furniture maker, explained his presence: ''The trouble with a gallery is that they're supposed to represent you but they may not understand you. They stand between you and the customer. I want to work directly with the customer. Basically, design is problem-solving. If I don't interact with the customer I don't know his problems.''

Pointing to a $2,400 desk of curly maple with walnut legs, he said: ''When the desk was sold the buyer wanted a blotter. So I made one with a walnut frame that brings the sculptural form of the legs onto the top.''

Among the other exhibitors are Laurence Seegers, who works in silver jewelry inlaid with ivory or ebony; Shirley Drevich, silver with colorful epoxy resins; David Nelson, porcelain decorative pieces that are stenciled and airbrushed; Alan Stirt, fluted wooden bowls; Bruce Erdman, exotic woods in tambour-lidded boxes; Warren Durbin, sledlike wooden trays and furniture, and Stephen Fabrico, glazed porcelain bowls and jugs.

The show is open tomorrow and Saturday from 11 A.M. to 9 P.M. and Sunday from 11 A.M. to 7 P.M. There is free parking around Memorial Hall, plus shuttle buses that run to and from the Convention and Visitors Bureau and the 30th Street railroad station.