The Interior Department has touched off a showdown with Virginia officials and the state's influential coal industry by seizing control of key powers to police environmental abuses by strip miners and other coal operators in Virginia's Appalachian coalfields.

Interior's controversial move -- the first such action against any coal-producing state -- was prompted by what federal officials portrayed as Virginia's failure to punish coal companies for environmental infractions in the state's mountainous southwestern region, long a regulatory battleground. State inspectors, Interior charged, were merely issuing warnings to violators, rather than imposing fines, mandating corrective actions or shutting down the violating mines.

The federal takeover, which included dispatching nine U.S. surface-mining inspectors to Virginia, was attacked quickly by senior state officials, the coal industry and environmental organizations. In the tangled history of surface-mining regulation in Virginia, their reaction amounted to an unusual alliance among the normally warring groups.

Virginia officials, asserting that their policies were spelled out in state laws previously approved by Interior, have threatened a court battle unless the agency backs down. One major coal company, mounting the first legal challenge to Interior's move, has obtained a federal court order barring U.S. officials, at least temporarily, from imposing sanctions for alleged surface-mining violations. Environmental groups have denounced Interior's actions as unlawful and urged the federal agency to switch tactics.

"This is worse than if they were not going to do anything," said Mark Squillace, a former Interior Department lawyer now working for the Washington-based Environmental Policy Institute. "It's clearly illegal."

Federal officials have not cited any evidence of recent, severe environmental harm in Virginia's coalfields, despite their complaints about the state's enforcement system. Nevertheless, they say that Virginia is employing more lenient measures to deal with environmental violations than any of the other 23 major coal-producing states, raising troubling prospects.

Government efforts to tighten surface mining controls repeatedly have stirred controversy in Virginia, where the coal industry remains an economic mainstay and a powerful political force. Critics long have accused Virginia of laxness in coal-mine regulation and the state was one of the first to challenge the 1977 Surface Mining Control and Reclamation Act in court.

The law, which was upheld by the Supreme Court last year, was designed to halt flooding, soil erosion, water pollution, landslides and other damage by mandating environmental safeguards at mine sites and requiring coal operators to restore their land to its approximate original contours after mining is completed. States were offered a central role in carrying out the federal act by establishing new state-run programs to regulate strip mines -- those where earth is scraped aside to expose coal deposits -- along with other mining operations affecting surface areas.

Amid protracted dispute, Virginia's plan for controlling environmental damage at coal mines was approved conditionally last December by Interior's Office of Surface Mining, an agency which also has been accused of backpedaling on control measures. Earlier this year, three environmental groups sued Interior, complaining of numerous shortcomings in the Virginia program. The lawsuit is pending in U.S. District Court in Richmond.

Ralph H. Cox, a federal surface-mining official, took over as director of the agency's small office in southwestern Virginia in March and was surprised to learn that Virginia was dealing with environmental irregularities by issuing "special orders." These amounted to mere warnings, carrying no penalty.

Cox says he believed the state should, instead, have been issuing notices of violation, used a stiffer enforcement mechanism requiring quick action to remedy environmental malpractices and usually imposing a fine of hundreds or thousands of dollars. His discovery led to an Interior review, followed by the announcement July 9 that the federal agency would reassert authority to enforce surface-mining regulations in Virginia. Since July, federal inspectors have issued at least 11 violation notices to mine operators, according to a state tabulation.

James R. Harris, director of the Office of Surface Mining, told a congressional committee this month that his agency needs $500,000 to maintain the additional federal inspectors in Virginia next year. "That certainly is a hybrid situation, to say the least," noted Rep. John F. Seiberling (D-Ohio), underscoring the unusual federal action by an administration dedicated to returning more responsibilities to state governments.

Virginia officials, coal executives and environmentalists have charged that Interior's takeover violated the 1977 surface-mining law. The federal agency's broad powers to police mine sites in Virginia ended, these officials contend, when Interior approved the state's surface-mining program. The act, the officials argue, permits federal inspectors to carry out enforcement measures in Virginia only in special circumstances, such as emergencies.

"We have monitored the activities of OSM inspectors since your announcement of early July," Betty J. Diener, the Virginia secretary of commerce and resources, said in a letter last month to Office of Surface Mining chief Harris. "In our view, none of the citations issued comes close to justifying the unusual step of abandoning the federal oversight role and returning to active enforcement . . .

"We resent the incorrect public impressions that this entire affair has created," she added.

Virginia officials say federal complaints about the state's regulatory efforts are unwarranted because Virginia must comply with its own surface-mining laws, previously approved by the federal agency. These laws, they say, were designed to allow a transition to the new, more stringent rules and stiffer enforcement measures.

During the transition period, the state plans to issue new environmental permits to all surface-mining operations. Only six such permits have been issued so far, state officials say, but about 700 are expected to be approved in the next 18 months. Under the state's surface-mining laws, Virginia officials say, mines lacking the new permits must be regulated under older rules, which include the much-disputed procedure of issuing special orders to violators. The stiffer notices of violation may only be handed out at mines operating under the new permits, they say.

Environmentalists object to Interior's move in Virginia partly because they fear it is likely to backfire. If Interior's actions eventually are ruled illegal, environmentalists say, federal citations issued for environmental abuses at Virginia coal mines may be nullified. "The end result is that all of these enforcement actions are going to be thrown out," says Environmental Policy Institute lawyer Squillace. "So what is accomplished? Nothing."

Environmentalists argue that Interior should, instead, take two steps authorized by the federal mining act. One allows federal inspections at mines if a state agency fails to take "appropriate action" within 10 days after Interior notifies it of an environmental violation. The second provision permits Interior to take over enforcement duties if it holds a public hearing and determines that a state is not effectively policing surface mines.

U.S. surface-mining chief Harris has rejected these options, however, terming them likely to lead to "arcane and pointless legal contests" with Virginia. Nevertheless, Harris has left open the possibility that Interior may reconsider its tactics if Virginia coal operators succeed in blocking federal inspections.

Just such a legal challenge has been launched by United Coal Co., one of the nation's largest privately held mining firms. Contending that Interior inspectors illegally entered a company-owned coal-treatment site in southwestern Virginia and unlawfully cited it for alleged violations, United Coal obtained a federal court order prohibiting any federally imposed fines or other sanctions until the dispute is resolved.

Walton Morris, a lawyer for the Office of Surface Mining, said recently that the agency will not object to similar "temporary relief" from sanctions for other Virginia coal operators if no emergency exists. Environmentalists complain, however, that such relief may stall enforcement measures for months while the legal dispute remains unresolved.

"The point OSM misses is that they approved the program, knowing the situation," contends United Coal's general counsel, Tom Fowlkes. "They either should have allowed the state of Virginia to run its own program or they never should have approved it in the first place."