Rep! Thomas P. O'Neill (D-Mass.) took office as Speaker of the House yesterday, saying Congress has proved it is a co-equal branch and will work "in partnership" with the new Democratic President.

Congress has recently reasserted "its rightful place in our scheme of government," siad O'Neill in a speech to the House as he became its presiding officer. "With the War Powers Act and the new budget process, Congress is providing that it is capable of operating on an equal footing with the Constitution demand that Pennyslvania Avenue remain a two-way street."

After a generation of watching much of its constitutional powers slip away to the executive branch. Congress acted in the last four years to limit the power of a president to wage undeclared war and set up machinery to shape its own national budget, rather than just take the President's budget and tinker with it.

O'Neill's statement was the latest in a series of messages from congressional leaders that the Democratic Congress will cooperate with President-elect Jimmy Carter but will not be a rubber stamp.

"In partnership with the new President," said O'Neill, "this new Congress faces a long agenda. Our first priority must be to put Americans back to work. We must restore faith in the federal government by proving that it can operate efficiently and honestly. We must bolster public confidence in Congress by adopting and living by a tough code of ethics."

The House, by a party-line vote of 256 to 142, then adopted new rules drafted by the Democratic Caucus last month. The changes would reduce the number of quorum calls that pull all members to the House floor from other duties, make it easier for committees to meet while the House is in session, and permit committees to amend bills with only one-third, rather than one-half, of the members present.

Democratic supporters said the changes would speed up procedures and make the House more efficient. Republican opponents said it would contribute to greater absenteeism from the House floor.

A request that required unanimous consent to reconstitute the Select Committee on Assassinations for two years was blocked up Rep. Robert E. Bauman (R-Md.) on grounds it was brought up without notice. However, a resolution extending the committee which expired Monday, is expected to be passed before the inquiry to the assassinations of President Kennedy and the Rev. Martin Luther King, Jr. runs out of funds.