In California, a young woman who has developed cancer because her mother took the drug DES during pregnancy can successfully sue for damages from a drug company even if she can't pinpoint the company that made the drug taken by her mother.

In practically every other state in the country, however, state laws would not permit the same woman to sue because she could not cite the specific drug company.

Similarly, in California and New York, if a manufacturer redesigned a lawn mower to prevent the blade from cutting a user's foot, that change could be used against the company as proof that the company knew its older products were unsafe.

Again, in every other state, improving a product's design cannot be used as evidence of guilt in product liability suits involving older machines that lack the new safety features.

This hodgepodge of product liability rules--made by state courts and legislatures--has prodded hundreds of business groups to press Congress to undertake a massive overhaul of the product liability laws now on the books.

As the Reagan administration is trying to return much of the government's operations to the states, business executives and many members of Congress are calling for federal legislation to pre-empt state laws and set uniform product liability rules for all courts.

Otherwise, they charge, businesses will become increasingly reluctant to create new products that could be susceptible to a wide variety of different court challenges in every state in the country.

"Federal legislation pre-empting state law and setting forth nationwide rules of liability would bring greater predictability and stability to the litigation process and to product liabilty insurance rates," which have been escalating rapidly over the past few years, said Victor E. Schwartz, who represents more than 150 business and trade associations seeking reform of state tort laws that allow citizens to sue for damages incurred.

However, consumer groups have sharply denounced the campaign for federal legislation, arguing that the proposed changes are designed to protect manufacturers from the growing number of product liability suits by limiting a consumer's rights to sue for damages created by unsafe products.

Legislation being drafted in Congress should be called "a manufacturers' liability exemption bill" because it "threatens to take away consumers' rights" by restricting their rights to sue in many instances, charged Barbara K. Pequet, legislative director for the National Consumers League.

This dispute between business and consumers over product liability has been building quietly over the past few years. But yesterday the controversy broke into the open during the first of what promises to be many congressional hearings on the issue.

Although legislation has yet to be formally introduced in the Senate and is not expected to be approved this year, a standing-room-only crowd packed a Senate hearing--attended by only one senator--to catch the opening salvos on a federal product liability law.

During the past six years, Congress has debated product liability issues repeatedly. Just last year, it passed a law to make it easier for owners of small businesses to afford increasingly expensive product liability insurance. But congressional sources who have participated in previous hearings said that yesterday's session represented the beginning of the most serious attempt to revise the nation's tort laws.

Leading the current effort is Sen. Robert Kasten (R-Wis.), whose staff has been developing draft legislation. "We need to take responsibility and take it now," he said. Otherwise, existing state rulings--even though not universal--will discourage development of new and safer products, and will "fence out" new, small companies that won't be able to afford insurance to offer new products, Kasten said.

The administration is expected to support Kasten's effort.

Lawyers, on the other hand, are expected to join consumers in opposing any federal law, arguing that the current state laws are adequate.