Workmen in Hyde Park are busy constructing a movieset palace the size of a football field for the spectacular wedding-eve fireworks -- that will celebrate the royal marriage of the prince of Wales and Lady Diana Spencer. The pyrotechnic extravaganza, only one part of what has become a national celebration, will re-create the 1749 display for which Handel wrote his "Music for Royal Fireworks" -- with fireworks forming intricate patterns against the 300-foot-long palace and rocketing high above it, accompanied by the massed bands of the queen's guards and household cavalry, the guns of the king's troop of the royal horse artillery, and two choirs.

At the 1749 event, commanded by King George II to celebrate the peace fo Aix-la-Chapelle, the Georgian fireworks palace burned down. Maj. Michael Parker, organizer of the upcoming re-creation, said part of the reconstructed palace will purposely be burned in memory of that disaster, but he hoped it would be safely contained. Hundreds of special fireworks effects on the palace will be designed, Parker said, to illuminate an ornamental biography of Prince Charles in burning replicas of his school, regimental and royal badges, decorations and insigna. The finale will feature the ascent of a giant, revolving sun 170 feet into the air as the "whole facade of the palace is covered with a waterfall of fireworks."

Prince Charles is to begin the show by lighting the first of 101 giant bonfires to form a chain of celebratory beacons that will extend through the night to every corner of the country, watched in Hyde Park on a giant television screen by an expected audience of half a million.

"It will be a big family party," said another organizer, "symbolizing the relationship we all feel with the royal family."

At the moment, preparations are under way throughout London. Under the imposing dome of St. Paul's Cathedral, carpenters and stonemasons are busy dressing up Christopher Wren's 17th-century architectural masterpiece for its royal wedding. The cathedral dean and the archbishop of Canterbury are supervising the painstaking preparations and conducting customary prenuptial consultations with the groom and bride, future king and queen of what once was the British Empire, now the United Kingdom of Great Britian and the Commonwealth Nations.

Prince Charles and Lady Diana are personally planning much of the July 29 ceremony in St. Paul's and among the 2,500 invited guests will be monarchs and government leaders from scores of countries, every ambassador to the Court of St. James', royal relatives and friends, and titled lords and ladies in medal-bedecked and jeweled finery. Loudspeakers will carry the ceremony to hundreds of thousands of people packing the streets outside St. Paul's, white television will broadcast the spectacle to more than half a billion viewers around the globe.

On the other side of London, in sprawling Hyde Park, horticulturists are making thousands of floral decorations for the two-mile wedding procession through the historic heart of the city, from Buckingham Palace to St. Paul's and back. Gold-encrusted state coaches will carry the royal family, Prince Charles and Lady Diana, escorted by mounted soldiers of the queen's household cavalry wearing shiny steel armor and plumed helmets and carrying long, flashing swords. Along the route, which is expected to be lined by well over a million spectators, will be guards and bands of othe royal household regiments in familiar ceremonial red coats and tall, black fur hats.

"In terms of the size of the crowds and the number of high-ranking foriegn dignitaries," said one police official, "this could be the biggest ceremonial event in London this century."

As Britain struggles in the depths of its worst recession in a half-century, with more than 11 percent of its work force unemployed, a few corners are being cut in the pomp and pageantry. Many of the flags and banners that will hang along the wedding procession route are leftovers from other state occasions. The red carpet on which the royal couple will walk the length of St. Paul's, with Lady Diana's long white train trailing behind her, was salvaged from the ceremony in the cathedral celebrating Queen Elizabeth II's Silver Jubilee in 1977.

But none of this will diminish for the British people what is clearly a welcome opportunity to escape in the nostalgic fantasy of regal splendor from the uncomfortable reality of economic crisis, lost empire and national decline. The country's Cinderella-like experience is perhaps best symbolized by the glass coach in which the bride will ride to her royal wedding, accompanied by palace footmen in fancy fairy-tale livery.

In fact, Lady Diana was born into one of the oldest of Britain's noble families that have served British kings and queens from the 18th century to the present. Her brother-in-law is an assistant private secretary to the queen and her grandmother had been a close friend and lady-in-waiting to Prince Charles' grandmother, Queen Mother Elizabeth. Distantly related to Charles through ancestors dating back to King Henry VIII, Diana was raised with occasional royal playmates on grand country estates and was a childhood friend of Charles' younger brother, Prince Andrew.

Nevertheless, since her engagement, the young woman with a winning smile, who just turned 20, has been endowed with the extraordinary glamor the British uniquely and enthusiastically preserve in their royal family at considerable cost to the treasury. From a shy nursery school teacher favoring sensible blouses and skirts, she has been transformed into a wildly popular figure dominating the media and setting fashion trends, and whose every public appearances creates a sensation.

Despite criticism from some fussy fashion arbiters, her youthful evening gowns have made national celebrities of the already trendy young London society dress designers, Elizabeth and David Emmanuel, who are making her weddiing dress (in six slightly differing styles in case the secret design of one or more of them is revealed before the day). Her bobbed hair has become a fad copied by hairstylists that is now available in a $60 wig at most department stores. Her arresting blue eyes peer coyly from countless magazines, books and royal wedding souvenirs that fill British store windows.

The booming wedding souvenir business has been a boon to the battered economy, if at the same time a blow to British decorum. Only 60 of more than 1,000 items sent to the British Design Council for review have received its approval. But many of the losers are nevertheless best sellers at proliferating sidewalk stands and souvenir shops around Piccadilly Circus, Trafalgar Square and other tourist haunts. The queen's lord chamberlain, protector of royal dignity, has fought a losing battle against unauthorized likenesses of the royal couple (many are unrecognizable), commemorative tea towels (sold instead as "wall hangings") and souvenir T-shirts (being rushed into stores by British manufacturers in defiance of the palace after the market was quickly flooded by foreign imports).

Avid collectors of wedding mementos can wear an assortment of souvenir T-shirts, skirts, wraps, head scarves, hats, jewelry (including cutrate "copies" of Lady Diana's engagement ring and Prince Charles' three-feathered signet ring of office) and buttons (some bearing irreverent slogans like "Don't Do It, Di"). The clothes can be displayed on hangers bearing life-size heads and torsos of Charles or Diana. Drinkers can carry royal wedding tippling sticks (the decorated silver head of the came unscrews and doubles as a drinking cup) and consume specially brewed "celebration ale" or tea from nearly 100 different souvenir mugs and glasses (many bearing purported likenesses of the royal couple and some sporting outsized princely ears as handles).

Loyal subjects can dine on a wide variety of royal wedding china matched with a large selection of commemorative silverware, ring royal wedding bells to summon the servants, eat sweets from commemorative tins, light cigarettes from souvenir lighters and stub them out in royal-couple ashtrays, display a multitude of commemorative plates and other bric-a-brac, cover walls with souvenir tea towels, posters and banners, sew with royal wedding thimbles, and tell time and forecast the weather with commemorative clocks and barometers. For leisure, devotees can kick prince-of-Wales soccer balls, fly kites portraying Charles and Diana, throw commemorative frisbees, toss souvenir balloons, put together royal-couple jigsaw puzzles, solve a crossword outlining Prince Charles' head, or read the royal wedding edition of the Bible or several dozen other books rushed into publication for the occasion.

Investors and the well-to-do can choose from an unlimited number of limited editions of commemorative crockery, glassware, silver, jewelry, ingots, bricks and even full-size cannons at prices reaching into tens of thousands of dollars. Merchants like Garrard and Co., the royal warrant crown jewelers, are offering the carriage trade similarly priced luxury items to give to the royal couple as wedding presents. Gerrard director William Summers, who explained he deals personally with such customers as "the royal family, the gentry, nobility and ordinary chaps like yourself, we hope," said he recommends expensive solid antique silver pieces made by his firm a century ago because "they won't break if the servants drop them."

Less pretentious Britons, who feel impressive affection and kinship for the royal family, already have sent several thousand more modest gifts to Buckingham Palace, where a spokeswoman said they and the countless thousands to come would all be accepted and acknowledged. "Anything usable will be used by the royal couple," she said. "They have an almost empty house in Gloucestershire and a completely empty one in London," which she hinted might be an apartment in Kensington Palace, where Princess Margaret already lives.

The palace spokeswoman added that the wedding has stirred greater interest than any royal celebration in recent memory. The queen's Silver Jubilee, she said, stirred Britain, but the wedding has much more worldwide interest.

The intense media pressure already has become a monumental headache for the press staff at the palace, a plethora of affected government agencies and the traditionally independent City of London, the financial district and ancient core of London where St. Paul's is located. One City of London official complained about being caught in the middle of an international argument over five lime trees outside the cathedral that block the television cameras' and photographers' view of the bride and groom coming down the front steps after the ceremony.

"This is the one picture everyone wants", he said, "and those trees are in the way. The superintendent of gardens treats the trees like children and has agreed only to trim them slightly. But I'm under pressure from the television people, and I'll get those trees down if we have to blow them up. ABC television has even offered to replace them after the wedding. They said, 'We'll fly new trees in from the States if you want.'"

Some of the event's cost also is being defrayed involuntarily by the media. Prices range from $100 for one of the 145 reporters' seats inside the cathedral and several hundred dollars for each photographer's position along the procession's route to $10,000 for an American television network's picture-window studio in a government-owned building overlooking St. Paul's. In addition, the dean of St. Paul's, the Very Rev. Alan Webster, has urged the media to make "substantial voluntary contributions" to the cash-poor cathedral in appreciation for the access it is providing to the ceremony.

Even many among the samll minority of Britons who, according to opinion polls, question the value of the monarchy in the modern world are planning to brave the crush of the crowds in the streets to get a glimpse of the royal couple. Others have changed their vacation plans to stay at home in front of their television screens for the day-long coverage here. "It wouldn't bother me that much if the monarchy were abolished," said a physician's wife in suburban London whose feelings were echoed by many others, "but I'm going to try to be outside St. Paul's for the wedding. I was picked from my school to stand and watch the queen go by to her coronation [in 1953], and I'll never forget it. I want my children to have a memory like that."

Plenty of foreign visitors, especially Americans, also are expected. Standard tours of historic places in London and country estates of the nobility, including Lady Diana's family home, have been repackaged as royal wedding specials. Hotels, including the Savoy, have scheduled royal weddding balls, and pubs and restaurants are being decked out in festive bunting to snare the tourist trade. London's famous red double-decker buses are being "wrapped" in painted gray gift ribbons, and souvenir "royal warrant" all-day passes are being sold for $4.50 for the buses and subway on the wedding day, despite the threat of a local transit strike.

Scotland Yard is worrying about visitors of other kinds. Besides the continuing threat of an Irish Republican Army attack on the royal family, there is the vulnerability of all those visiting monarchs and heads of state to terrorists from their own countries who might try to strike at them here. Their bodyguards are prohibited from carrying guns here, although British Special Branch officers helping to protect them are likely to be armed.

After a teen-ager fired a blank pistol at the queen as she rode horseback down the Mall from Buckingham Palace in the annual military parade celebrating her official birthday last month, security for the royal wedding will be the tightest ever for an event on London's streets, according to police officials. The crowds along the procession's route will be kept back by a solid fence of 8,000 steel barriers and will be watched by policemen and soldiers standing just four feet apart for the entire two miles, as well as by closed-circuit television cameras and helicopters hovering overhead. Every building along the route is being inspected beforehand and every person planning to watch the procession from the windows (in some places, for fees up to several hundred dollars per head) must be listed in advance and prove their identity on the morning of the wedding. Officials expect spectators to begin camping out at good vantage points on sidewalks along the procession route on the Sunday before the Wednesday morning wedding, and police will be in place then, too.

A major logistical problem has been posed, said one police official, by the scores of heads of state here. They all want to travel to St. Paul's Cathedral in motorcades, down the wedding route past the huge crowds, just before the queen does, according to the official, who said this would be impossible. The route must be cleared for the royal family long before the queen leaves Buckingham Palace, he explained. So many dignitaries, including Nancy Reagan, are expected that many of them will have to cool their heels inside the cathedral for up to an hour before the ceremony begins. The last to arrive before the royal coach procession begins will be the crowned heads of other monarchies.

In what amounts to a family celebration for the scattered descendants of Queen Victoria, those other monarchs will then join the royal family and a select number of the other dignitaries at an early afternoon "wedding breakfast" after the procession back to Buckingham Palace. Prince Charles and Lady Diana will make a traditional appearance on the palace balcony facing the royal Mall, where they are certain to be lustily cheered by hundreds of thousands of people who will have spent many hours -- if not days -- waiting there for that one moment. The married couple will then ride in still another royal coach procession across the Thames to Waterloo Railroad Station for the journey to their secret honeymoon hideaway.

Just where that will be isn't known, although there is speculation that the estate of the late Lord Mountbatten is being readied. Normally it is open to the public for tours. But Bob Pullin, a spokesman for the estate, said it would be closed the week of the wedding. He said the palace would have to comment on why -- and so far, the palance won't.

Broadlands, as the estate is known, is located in Hampshire, the rolling hillside country west of London, and in 1947 the queen and the duke of Edinburgh began their honeymoon there. If Prince Charles and Lady Diana begin their honeymoon at Broadlands, just how long they would stay and where they would travel afterward is keeping Britons guessing. All the palace says is that the two are expected to be out of the public eye for an extended time after the wedding festivities are over.