Nancy Reagan kicked up her heels Balinese-style today, using some of the same fancy footwork that grabbed headlines for her when she traveled to Spain while President Reagan was at last year's Economic Summit.

"Am I supposed to do that?" the first lady asked two young Balinese girls who were fluttering their fingers and arching their feet in the graceful motions of Balinese folk dancing.

She complained good-naturedly that they were going too fast for her to imitate them, but didn't let that stop her from trying. Behind her, hands aflutter too, was her hostess, Indonesian first lady Siti Hartinah Suharto.

"I'll never be as good as you," Mrs. Reagan told one of the children, who has been training for several years as a dancer but spent the past month rehearsing today's number, one of two created especially for the Reagan visit. The dancers were dressed in gold, one group representing a flock of wild ducks, with their arms wrapped in purple cloth wings, the other playing deer and wearing tiny gold antlers.

The performance came during Mrs. Reagan's first cultural outing away from the beach-front hotel where she and the president have been resting after their 11,432-mile flight from Washington en route to the Economic Summit in Japan.

The outing began and ended in a compound of structures outfitted to represent a Balinese village. A 15-car motorcade brought Mrs. Reagan the half-mile from the hotel under tight security. The day was hot and steamy, and Mrs. Reagan met it head-on with a new hairdo. It, too, was created for the visit, but by her personal hairdresser, Julius Bengtsson, who always goes abroad with her for just such emergencies.

"It was the only way," said Bengtsson of his antihumidity handiwork. He pulled Mrs. Reagan's hair away from her face and anchored it with a green band that contrasted with her light green silk dress.

Mrs. Reagan seemed particularly interested in an explanation about the tooth-filing ceremony performed on girls when they reach puberty. Six front teeth are filed down to rid the girl of bad characteristics that are believed to come with the teeth: anger, confusion, arrogance, greed, desire and jealousy.

"Have you had it done?" Mrs. Reagan asked a woman escorting her. When the woman told her she had, Mrs. Reagan looked surprised. "Really? It doesn't look like it. When you say 'filed' I think of something very short."

Among the craftsmen brought in to display their work for her was Iwan Tirta, one of Indonesia's foremost batik designers. A graduate of Yale's law school, Tirta turned to batik after teaching international law in Jakarta and also in the United States, at Cornell University and the University of California at Berkeley.

Tirta also designed the batik dress worn tonight by Mrs. Reagan at the dinner given for President Reagan and representatives attending the Association of Southeast Asian Nations (ASEAN) by Indonesia's President Suharto.

The dress, a butterfly design in red with long sleeves and a boat neckline, was Mrs. Suharto's gift to Mrs. Reagan, and a batik shirt, also by Tirta, was Suharto's gift to President Reagan. The shirt was brown and black and featured a repeated Presidential Seal pattern.

Secretary of State George Shultz and White House chief of staff Donald Regan also wore their new gift batik shirts, as did others in the Reagan party.

Gaston Sigur, assistant secretary of state for East Asian and Pacific affairs, failed to make the party because he slipped while coming out of the shower and suffered a cut on the forehead that required 10 stitches.

At the head table with Reagan and Shultz was Philippine Vice President Salvador Laurel. Among the 140 other guests was Indonesia's second most powerful man, Gen. Benny Moerdani, who sat next to Regan.

Besides heading the army, Moerdani also controls the media through the military intelligence community. The final decision to bar entry to two Australian journalists would have been made by him, American sources said.

In the afternoon, Mrs. Suharto entertained Mrs. Reagan at tea. This time the bandeau was gone and her hair was back to normal. She had also changed into a white dress with red dots.

Mrs. Suharto had another gift for Mrs. Reagan, a new variety of deep purple hybrid orchid named Dendrobium Nancy Reagan.