Woodward & Lothrop, already the dominant department store in the Washington area, is preparing to announce a major expansion into the Baltimore market.

Baltimore retail sources said yesterday that Woodies has talked to developers who are planning several major shopping centers in Baltimore and Anne Arundel counties.

The new stores under discussion would complete an arc of Woodward & Lothrop units around Baltimore. The chain already has stores in Annapolis to the south and Columbia to the southwest, and is studying shopping centers west and north of the city.

Woodward & Lothrop has called a press conference next Monday to announce what are described as "expansion plans for the 1980s with an eye toward Baltimore."

Speculation in Baltimore yesterday was that Woodies is most likely to locate stores in seven major malls on which construction is expected to start in the next year or two.

Those malls include a project in Anne Arundel County near Glen Burnie that is planned by Taubman Co., a Michigan developer. Taubman is the landlord for Woodies at Lakeforest Mall near Gaithersburg, which opened last year and at a new shopping center being built near the intersection of Interstate 66 and Route 50 in Fairfax County.

Also said to be on Woodies' shopping list are two projects being developed by Rouse Co. of Columbia, which built the shopping center that houses the Woodward & Lothrop store in that development.Those sites are White Marsh Mall, to be opened in 1981 near I-95 north of Baltimore, and Painters Mill, a center set to open in 1984 at Owings Mill, northwest of the city.

"We're always talking to Woodies," said Rouse spokesman Scott Ditch, but he said he couldn't confirm or deny reports that Woodies was negotiating for stores in the two centers. Already signed up for White Marsh are Sears Roebuck & Co., J. C. Penney, Hutzler's -- a Baltimore-based chain -- and Bambergers, the suburban division of New York's Macy's. The center, however, has room for an additional department store, Ditch said.

Developers also reportedly are trying to interest Woodward & Lothrop in malls planned for McDonough Road, Reisterstown and Cockeysville, all north of Baltimore.

The Baltimore area is considered ripe for department store development because no chain dominates the market the way Woodies dominates the Washington retail scene.

According to a study by Merrill Lynch, Pierce, Fenner & Smith Inc. the race for the top spot in Baltimore is a toss-up between Hutzler's and the Baltimore division of Washington-based Hecht's. Each is estimated to do about $70 million a year.