Thalidomide. In 1961, doctors discovered that this drug, prescribed to pregnant women as a sleep aid, caused hideous deformities in their babies. Swiftly, federal regulatory officials began ordering new safety tests to detect other substances that might cause mutilating physical birth defects. But they left a gaping loophole. They failed to order safety tests to detect birth defects of the mind.

In fact, the most common type of birth defect in people is not misshapen bodies but serious mental and behavioral handicaps. Far more children have suffered brain impairments from prenatal exposure to hazardous substances than ever were victims of thalidomide. Yet today, more than 20 years after birth-defects testing was instituted, our government virtually never asks manufacturers to test whether any of their products could act as a thalidomide of the mind.

As a result, substances that warp prenatal brain and nerve development are seldom recognized or controlled until countless infants have been harmed.

Take the case of Christine and Elizabeth Harbeson. Their mother, an epileptic, had been treated with a drug called Dilantin. At the time she started taking it, thousands of women had already given birth to babies whose mental growth had been stunted by the drug. But without federal screening for such effects, the medical community was slow to recognize the connection. No warning about the mental risk for infants was published until 1975. But that was too late to help Mrs. Harbeson. By then, both her daughters had been born with brain damage.

Dilantin isn't the only drug or chemical hazard that can cause prenatal brain and nerve defects. Consider the following examples:

*Toxic mercury contaminants in Iraq, New Mexico and Japan injured scores of infants who were exposed before birth through their mothers' food supply. These babies were left with a tragic legacy of mental retardation and grim coordination problems.

*Cigarette smoke inhaled by pregnant women recently has been linked to poor attention span and hyperactivity in their children.

*PCBs are similarly suspect. The babies of mothers who've eaten PCB-contaminated Lake Michigan fish show jerky movements, dulled emotional responses and other worrisome behavioral abnormalities.

*Barbiturates prescribed during pregnancy can make infants jittery, sleepless and frantic. Some studies suggest that these drugs, which appear in products ranging from painkillers to sleep aids to nausea medications, may also increase the unborn child's risk of developing later learning disabilities.

*Alcohol consumption by expectant mothers is such a frequent cause of prenatal brain defects that it now ranks an ominous third among the known sources of mental retardation in the western world.

How many other chemical substances might pose similar dangers? No one can say. According to the University of Cincinnati's Dr. Charles Vorhees, a leading authority in the field, "So far, only a handful of the 60,000 or more commercially important chemicals have ever been tested to see if they threaten the unborn child with IQ losses, hyperactivity, emotional instability or other behavioral birth defects."

The Food and Drug Administration doesn't require manufacturers to screen for such risks before putting new food additives or medications on the market. The Environmental Protection Agency has been equally lax in approving industrial products.

Failure to screen for sources of behavioral birth defects flies in the face of some of the most sobering health statistics on record. Abnormalities of the mind and nerves are by far the greatest cause of long-term disability in this country. Roughly one out of every 10 children suffers from nervous-system handicaps. By neglecting to test chemicals that might contribute to these disorders, the government may well be abandoning our best prospect for finding preventable causes of childhood brain damage.

Several other nations have already tackled the problem. The European Economic Community countries and Japan all require at least limited testing of new drugs to identify those most apt to provoke behavioral birth defects.

Our own government agencies have sat on the sidelines too long, claiming that behavioral tests are unreliable. But this year could mark a turning point for the United States to take leadership in the field. Last year, scientists from around the world gathered in Cincinnati to learn the results of a massive, seven-year federal study on the value of animal tests for detecting behavioral birth defects. The findings showed that properly designed behavioral tests are just as reliable and sensitive as many other long-accepted methods of chemical screening.

There is now a pressing need for these conclusions to be translated into action. The ultimate goal must be routine evaluation of all new chemicals for their prenatal effects on brain and nerve function.

Such a requirement would not put an undue burden on manufacturers. Experts estimate that testing for behavioral birth defects should cost about $10,000 to $30,000 per compound. That isn't much when compared with the $500,000 or more it usually takes to conduct other tests needed for a chemical's approval. And it pales to insignificance beside the lifelong costs of mental retardation and instability.

The alternative to testing for prenatal mental damage is risking the welfare of our children. But didn't we learn that lesson already from thalidomide?