Toothpaste. Permanent press clothing. Toilet seats. Plastics. Plywood and particleboard. Shampoo. Draperies. Mascara. Air fresheners. Tissues. Nail polish. Buttons. Carpeting.

All these products have one thing in common: like urea-formaldehyde foam insulation, they all contain the chemical formaldehyde.

The Consumer Product Safety Commission's decision Feb. 22 to ban formaldehyde foam insulation because it presents an unreasonable health risk has provoked consumer concern over the safety of the hundreds of other products that contain formaldehdye.

The chief reason for this fear is the CPSC's finding that formaldehyde has caused cancer in laboratory animals.

Industry and government officials urge consumers not to panic, saying that to date the use of formaldehyde in most other products has not been found to be a significant health risk, and there are no plans to ban any of those items. Nevertheless, studies of products containing formaldehyde are continuing.

Industry groups argue that with the exception of the two cancer studies relied upon by the CPSC, tests have not linked formaldehyde to cancer. Consumer groups, on the other hand, say that too few tests have been conducted to assure consumers that formaldehyde is a relatively low-risk chemical.

More than 6.5 billion pounds of formaldehdye are produced each year in this country by 40 different companies. The chemical is used in 640 products--either as a binding agent or as a preservative and antibacterial agent. Total sales of all products containing formaldehyde account for 8 percent of the gross national product, according to the Formaldehdye Institute.

Formaldehdye foam, or "UF-foam," as it is called in the industry, accounts for less than 10 percent of U.S. production of the chemical. Even so, it is that product which has sparked the greatest concern about formaldehdye.

"UF-foam is unique," says Jack Murray, president of the Formaldehdye Institute. Unlike other products made in factories and therefore easier to subject to quality-control programs, UF-foam is manufactured at the site where it is to be installed. "If someone is not watching, the amount of formaldehyde going into the foam could increase, possibly substantially," says Murray.

What's more, he adds, unlike other materials that are easy to remove from a house if a consumer develops an allergy, UF-foam is very expensive to eliminate--perhaps more than 10 times the average $1,200 it costs to install the insulation.

CPSC officials note that one of the chief reasons UF-foam was singled out is that it contains considerably higher levels of formaldehyde than most other consumer goods.

The Food and Drug Administration says that is one reason it has not taken any regulatory action to ban or control the use of formaldehyde in the products it regulates--including cosmetics, drugs and food wrappers--which industry experts say contain less than one percent of the chemical.

Moreover, the FDA argues that it has insufficient evidence to justify a ban or less rigid restrictions. In an FDA position paper, the agency notes that in the products it regulates, consumers come in contact with the chemical either through ingestion or skin contact. They do not inhale the gas, as is the case with the insulation. Thus, the FDA says it cannot rely on the same scientific tests used by the CPSC to issue the ban. In those tests, rats developed cancerous tumors after breathing high levels of the gas.

The FDA has asked the National Cancer Institute and other government agencies to conduct more studies to determine if further action is warranted.

Two other government agencies--the Occupational Health and Safety Administration and the Environmental Protection Agency--have recently turned down petitions to take special action on formaldehyde and quickly move to impose tighter rules on its use. Although there is strong sentiment among staff members for quick action, top-level officials decided there was not enough data to conclude that formaldehyde posed a significant risk to workers and the population at large. But the CPSC decision may put new pressure on these agencies.

The Department of Housing and Urban Development, however, is trying to control the release of formaldehyde from plywood and particleboard in mobile homes, where there is relatively little ventilation. Almost half the formaldehyde used in the United States goes into plywood, particleboard and similar wood products.

The release of formaldehyde from these products can often cause as serious a problem as those created with UF-foam. However, the industry and CPSC officials say that in the wood-products case, the problem may be easier to correct, since quality control standards can be easily imposed at the factory, and the industry from the beginning of the formaldehyde controversy has been eager to cooperate to avoid a ban.

Meanwhile, the CPSC continues to explore the health risks of formaldehyde in other products. One of its chief concerns is the use of the chemical in school laboratories. But it is likely the commission will hold off issuing any rules governing the laboratory use of formaldehyde because exposure to the chemical is brief and because many laboratory supply houses have substituted less toxic products for formaldehyde.

But at the moment, the CPSC has "absolutely not" planned bans on other products, says Dr. Peter Preuss, the agency's director for health sciences.