Radiation Systems Inc. of Sterling announced yesterday that it has received a $55 million contract from the National Science Foundation to construct the world's largest fully steerable radio telescope in rural West Virginia.

The 500-foot tall, 10 million-pound telescope, which will gather radio signals from space, will be the most powerful radio telescope available for many facets of astronomical research, including mapping the structure of the universe and the study of such phenomena as pulsars and young galaxies, said Paul Vanden Bout, director of the Science Foundation's National Radio Astronomy Observatory (NRAO). Pulsars are celestial objects that emit electromagnetic radiation at short, regular intervals.

The contract is a boon to Radiation Systems and the state of West Virginia, which will receive about $12 million in revenue as a result of the project, said Radiation Systems President Richard Thomas.

The new telescope will replace an older, smaller and less precise instrument that collapsed two years ago after about 25 years of service. The site of the new structure, in a remote valley between Green Bank and Arbovale, W.Va., also is the location of two smaller telescopes used for a variety of scientific purposes, including the Naval Observatory's time calculations.

When the telescope is completed in 1994, the site will be home to resident and visiting astronomers from around the world and will have a full-time staff of 75 to 100, Vanden Bout said.

The contract is the largest in the history of Radiation Systems and comes on the heels of a $34.4 million subcontract it received two weeks ago from Unisys Corp. to manufacture 37 antennas for the U.S. Air Force's North Warning System in the Arctic.

Radiation Systems has arranged for Loral Western Development Laboratory of San Jose, to help design and engineer the West Virginia instrument, which will have many features never before seen on a radio telescope, Thomas said.

Because of the size and weight of the 328-foot receiving dish, for example, special measures must be taken to ensure that gravity does not reduce the telescope's precision when it is turned. To deal with this problem, the dish will be made of 2,000 6-by-8-foot reflector panels, each of which will be guided by its own motor.

Construction of the antenna will begin next summer and probably will be completed in early 1994, Thomas said. A crew of at least 50 will build the telescope, its foundation, a parking lot and associated buildings, Thomas said.

Radiation Systems, a public company whose stock is traded over the counter, provides antennas and satellite systems for commercial and military projects and has built a number of much smaller telescopes for the NRAO since 1985.

Last year it had revenue of $85.2 million, up from $54.9 million the year before, and made a profit of $5.6 million. Thomas said the company is expecting sales to exceed $100 million this year.

The company's stock has hovered around $10 for a couple of years. It closed yesterday at $11.75.

Radiation Systems has found an increasing market for its products as the world has become more dependent on satellite communications, Thomas said. Last year the firm began outfitting high schools nationwide with satellite dishes and wiring to receive Channel One broadcasts, teen-oriented news programs that have provoked controversy because they carry advertising.

That $43 million contract represented a turnaround for Radiation Systems, which had experienced fitful growth since the early 1980s. But the West Virginia contract, Thomas said, has been the most challenging the firm has pursued. To get the contract, Radiation Systems beat out a Canadian construction firm and a German antenna manufacturer.

"We spent a fortune just doing the proposal," he said. "This is one of the nicest Christmases we've ever seen."