Carboxymethylcellulose was a dream chemical for Procter & Gamble Co., which learned how to form it into a unique, fishnet-like molecule with tremendous absorbent powers.

It was the key ingredient in P&G's Rely, the superabsorbent tampon that in less than six years had taken over nearly one-third of the estimated $400 million tampon market, according to financial analysts.

Now Relay is off the shelves, a potential $75 million loss to P&G. The Center for Disease Control has linked the tampon to toxic shock syndrome, a still-mysterious infection that has been blamed for at least 40 deaths, primarily among young women who used tampons.

But carboxymethylcellulose and other superabsorbent synthetic materials are apparently far from finished. P&G's competitors are rushing to develop a new line of thin, very absorbent external sanitary napkins that could replace tampons for many women -- or so the companies hope.

Although researchers still are struggling to understand toxic shock syndrome, among their prime targets are the superabsorbent tampons like Rely -- not because carboxymethylcellulose and other products are themselves hazardous but because their superabsorbent powers appear to have worked too well when overused.

Doctors in Cooperstown, N.Y., reported to the Food and Drug Administration last week that overuse of superabsorbent tampons by some of their patients apparently had dried out the protective lining of the vagina, making it vulnerable to abrasions and ulcers.

Although none of these women contracted toxic shock syndrome, damage to the vaginal walls would provide a path for the toxin to enter the bloodstreams of its victims, said Dr. Balazs Selendy of Cooperstown.

Researchers at CDC also believe that some women had left the super-absorbent tampons in place too long, encouraging the growth of the bacterium that carries or causes the disease.

In addition to warning against the use of Rely, the Center for Disease Control has urged women who use other tampons to be sure to change them daily. Whether these warnings have blighted the future of all tampons is not yet clear says Leo Shapiro, a Chicago marketing specialist.

If so, that could create a dramatic increase in demand for the very thin, superabsorbent sanitary pads. They were introduced first in Europe in 1977 by Unilever (parent company of Lever Bros. in the United States). Other companies scrambled to catch up to Unilever in Europe, including Johnson & Johnson, the leading manfacturer of sanitary napkins in this country, and Tampax Inc., the dominant firm in the tampon field until recently, when Rely emerged as a serious challenger.

Johnson & Johnson began selling its superabsorbent external sanitary pad in the United States this year, rapidly accelerating its normal product introduction timetable. The product, Sure & Natural Maxishields, uses carboxymethylcellulose (CMC) as its key ingredient.

CMC is derived from cellulose, one of nature's most common materials, which forms the walls of plant cells. According to Dr. Lillian Yin of the Food and Drug Administration's medical devices bureau, CMC is not hazadous to humans. The FDA has approved it as an ingredient in ice cream and tooth paste -- it makes them thicker and "creamier."

In developing Rely, P&G found a chemical process that could link the parallel chains of CMC into a three-dimensional net structure ideally suited to entrap fluids. P&G calls this "cross-linking" and the process gave the company a strong edge in the superabsorbency field.

"No other product is made exactly this way and we had to design our own equipment to do this," said Philip F. Wieting, a P&G official who testified during a court suit last year between P&G and Johnson & Johnson.

The "cross-linked" CMC is cut into small granules and mixed with polyester foam, which acts as a sponge and also provides protective cushioning of the harder CMC granules.

The combination worked remarkably well -- until the toxic shock connection was disclosed.

Johnson & Johnson has not divulged how it makes CMC into a superabsorbent material. However it is done, the new product is a vast improvement, noted U.S. District Judge Pierre Leval, who decided the lawsuit between P&G and Johnson & Johnson in December. Where J&J's standard product, Stayfree Maxi-pads are a bulky three-quarters of an inch thick, J&J's new Sure & Natural Maxishield measures just one-quarter of an inch but is equally effective, the judge said. (The lawsuit dealt with P&G's unsuccessful attempt to prevent J&J from using the product name "Sure," over which P&G had claimed trademark rights. Judge Leval ruled against Procter & Gamble.)

Although P&G does not now sell an external sanitary pad and will not discuss its plans in this area, J&J believes it is in a race against P&G and others to establish the new, thin pad in the United States. P&G Chairman Edward G. Harness said last week that Procter & Gamble is keepin its options open.

Shapiro, the Chicago market analyst, said it is not clear whether the toxic shock syndrome scare will fatally weaken the popularity of some or all tampons, creating an instant demand for the superabsorbent, super-thin pads.

Even the question is premature, says Yin of the FDA. "You can't tell young women not to use tampons. That's part of their culture now," she said.