Two mega-projects planned south of National Airport are setting off an acidic debate between developers and Alexandria activists who fear Old Town could be dwarfed by massive office buildings and gridlocking traffic, wrecking the small-town way of life there.

Despite the fact that the area's economic slowdown and the surplus of office space could slow the advancement of Potomac Yard and Potomac Greens for years, the dispute about two projects calling for a combined 19 million square feet of development is already worrying City Council members, who face elections in May.

On Wednesday, rhetoric was transformed into action when three of the council's seven members proposed a development plan that would limit residential and commercial growth in the Potomac Yard corridor to less than a third of what developers proposed.

The plan offered by council members Kerry J. Donley, T. Michael Jackson and Vice Mayor Patricia S. Ticer, all Democrats, proposes a maximum of 6 million square feet of development, with 80 to 90 percent of the area designated for residential use.

Their action reflects the importance and the intensity of the dispute over two projects that would create an urban center about the size of Old Town on twice the acreage of Tysons II within sight of the Washington Monument.

Potomac Yard, once a busy railroad switching area that today is one of the largest and most valuable unbuilt tracts on the East Coast, would be the site of 17 million square feet of buildings on 320 acres in Arlington and Alexandria. The adjacent Potomac Greens, a $500 million project, proposes an additional 2.8 million square feet of office, hotel and residential space.

The two projects "clearly are the most important issues facing the city," said John Young, president of the Alexandria Federation of Civic Associations. "They will set the tone for how we balance redevelopment and the quality of life in a city that has character and charm."

This fall, the City Council will consider zoning changes that will shape the size and scale of Potomac Yard and Potomac Greens, culminating in a deep-seated debate that has fueled civic activism.

Negotiations aimed at compromise between developers and civic activists have ground to a tense standstill. Alexandria residents have received mailings from both sides arguing their positions on Potomac Yard. Development opponents recently appeared at a public meeting to issue a "citation" to developers, accusing them of fostering traffic gridlock. Language used by both sides is harsh.

Potomac Yard -- the development would be called Alexandria 20/20 -- has been proposed by the Richmond, Fredericksburg & Potomac Railroad and CSX Realty. The proposal has helped spawn a new anti-growth civic organization. Potomac Greens, which is being developed by the Savage/Fogarty Cos. Inc. of Alexandria and RF&P, has been tied up by lawsuits for several years.

"These feelings are deeply held," said April Burke, who served on an advisory committee appointed by the council to work with the Potomac Yard developers. "People are worried about their neighborhoods."

The debate has centered on predicted traffic problems, how much of the development should be offices, and on how much of the site should be used. Some advisory committee members are calling for 2 million square feet of development -- not 17 million.

After a year, negotiations between the developers and the advisory committee broke off in March, with each side accusing the other of being less than truthful.

"People felt like we were wasting our time, that the group was being co-opted," Burke said.

Developers argue that the project, which would be built over 30 years, provides for a transportation system that should ease traffic problems.

"No piece of ground in the country has potential for transit that this property has," said Denton Kent, executive director of Alexandria 20/20, noting that the site includes an existing Metro station. Kent, a former deputy county executive for planning and development in Fairfax County, said two Metro stations -- paid for by his firm -- are planned for Potomac Yard.

Residents and developers are awaiting a transportation impact study expected to be released this fall.

Howard Middleton, a lawyer representing 20/20 and a former deputy city attorney in Alexandria, said the firm hopes for a "truly community development" by one developer over an extended period of time, rather than piecemeal construction.

The areas along Route 1 and the George Washington Memorial Parkway, the two main gateways into the city, have long been the site of controversy.

In 1987, the developers of Potomac Greens filed an application for a development, but they withdrew the request after a tumultuous hearing in which residents raised concerns about potential traffic jams on the George Washington Parkway. The developers submitted another plan, which the city rejected.

The developers sued in federal court, alleging that the city's action was illegal. The suit was later dropped, with the option that the developers could file it again within two years.

City officials had hoped that an environmental impact study would be completed before the deadline. The study was not completed, and the $50 million suit was filed once more last January. Potomac Greens officials submitted a third proposal in 1988, but it has not been considered by the city Planning Commission.

Potomac Greens developers declined to be interviewed. But residents were eager to talk about their fears about the project.

"Over the years Alexandria has been a 15-square-mile residential community," said Ellen Pickering, a board member of Save the George Washington Memorial Parkway, a group that fought the Potomac Greens project from its inception. "To try to tip the balance toward commercial and office space goes against everything . . . that is the flavor of Alexandria."

The civic activism that grew out of the debate over Potomac Greens has now evolved further. Until now, local civic associations generally took positions on issues of concern to their areas, but did not take stands on political candidates.

That was changed by the formation of a group called No Gridlock, a citywide citizens coalition opposed to large-scale development, said John H. Sullivan, who is on the group's steering committee.

Burke, who is president of No Gridlock, said the group likely will endorse candidates and may even field candidates of its own. The organization also may develop a report card on how council members vote on development issues.

"If they approve anything close to 12 million feet," Burke said, "I think the people will throw them all out."

No Gridlock "augurs a more negative attitude that we have not seen in the city," 20/20 attorney Middleton said. " . . . A minority is seeking a destructive process."