MARTINSVILLE,VA. -- To its critics, the fledgling Virginia Museum of Natural History here is derided as "Philpott's Folly." But to its supporters, the small, private museum could be the savior of pieces of Virginia history threatened with neglect or loss.

Urged on by House Speaker A.L. Philpott (D-Henry), whose district includes part of this town of 15,000, the Virginia General Assembly is studying a proposal to transform the private museum, housed in a former elementary school, into an official state facility under the Department of Natural Resources.

Within the state's museum community, there is little opposition to the idea of a museum of natural history -- archeologists say many valuable artifacts have been lost or given away for the lack of one -- but the question is whether Martinsville, located about 40 miles south of Roanoke on the North Carolina border, is the place for it.

The idea is the brainchild of Noel T. Boaz, a 35-year-old paleontologist who, after a brief career as a field researcher in Africa and as a professor at New York University, came home to Martinsville in 1984 to establish a small private museum.

"It's the political time to do it," Boaz said of the proposal, adding that with the death in 1985 of longtime Senate Finance Committee Chairman Edward E. Willey, Philpott "is clearly the strongest member of the legislature, and he has helped at every turn."

Since Willey's death, requests for state funding for local museums -- often dismissed during his two-decade reign in favor of projects in his home town of Richmond -- have proliferated.

Many legislators are busily seeking a piece of the state money pie for local museums, and $38.5 million has been appropriated for the 1986-88 biennium -- none of it designated for museums in Northern Virginia, however.

None of those local museums is as ambitious as the one in Martinsville, where Boaz seeks to establish "one of the leading museums in the nation" with an annual budget of at least $2 million, a staff of 66, additions to the school building and branches at Virginia Tech in Blacksburg, the University of Virginia in Charlottesville and Big Stone Gap in Southwestern Virginia.

A Senate-House subcommittee, of which half the members were named by Philpott, could announce its recommendation at its next meeting on Tuesday.

The Council of Virginia Archaeologists and the Archaeological Society of Virginia have recommended to Gov. Gerald L. Baliles that such facilities be located in Richmond under the supervision of the state's division of historic landmarks.

Another more logical locale, according to several museum experts, is at Virginia Tech, which already has a collection of 880,500 bones, stuffed animals, fossils and other items -- enormous in comparison with the 20,000 objects housed here. Others have suggested the Brooks Museum of U-Va. or the Science Museum of Virginia in Richmond.

"It makes little sense to locate it in Martinsville," said Robert N. Bowen, project director at the Science Museum and a former member of the accreditation committee of the American Association of Museums. "Most state museums are located in major centers of population, or adjacent to a major state university."

Boaz said that while Tech's collection is much larger than his, Tech's "was never pulled together" and, as a result, two major collections were given to the American Museum of Natural History in New York about three years ago.

Similarly, he said, all but about "50 ratty specimens" of a 12,000- piece collection at U-Va. was "destroyed willfully or allowed to deteriorate."

Six members of Tech's Department of Geological Sciences, including its chairman, have sent a letter to university administrators in which they said that moving the specimens off campus "would destroy the very reason they were assembled" and result in the loss of "valuable teaching and research material."

Further, they said, an off-campus museum would be "very difficult" for faculty and staff to use, and its "operating costs . . . could be enormous."

Nonetheless, Gary R. Hooper, Tech's vice provost for research and graduate studies, said, "We are very interested in the project."

Stephen Pflog, acting chairman of the Department of Anthropology at U-Va., said he has no objection to the museum's being in Martinsville, but said "you can make arguments" for locating it elsewhere.

Robert Sullivan, director of the privately supported Virginia Living Museum in Newport News and one of three people named to an advisory board by Boaz, said that while he is "open-minded" about where a natural history museum should be placed, state museums "generally are located in capital cities" and often are clustered, allowing for "a certain synergism."

"A lot of us don't understand" the impetus for putting a museum in Martinsville, said Chris Houme, executive director of the Science Museum of Western Virginia in Roanoke.

Philpott said he "initially discouraged" Boaz, fearing that his proposal "might conflict with all these other institutions," but said he changed his mind after he determined that the Science Museum in Richmond, for example, "did nothing" with its plans for a natural history wing.

As for complaints about the Martinsville project, he dismissed them, saying: "People are always trying to protect their turf."