Defense Secretary Harold Brown and Central Intelligence Agency Director Stansfield Turner are head to head in a major institutional battle over future control of the intelligence community.

The $5 million annual budget and all the technical spying operations of the National Security Agency and the National Reconnaissance Office are the prize.

Turner has made a strong argument to President Carter and others involved in the debate over reorganization of the intelligence community that there should be greater centralization bringing the NSA and the NRO under the direct budgeting and operational control of the director of the community.

Turner, like his predecessors, heads both the community and the CIA, but in practice actual control of the NSA and the NRO has been exercised by the Secretary of Defense.

Brown has also taken his case to Carter, arguing that it would be a mistake to give any agency or individual a monopoly on intelligence estimates and operations.

"Although I think it is possible and proper to set up a centralization in some parts of intelligence . . . the estimating function has to continue to be such as to allow the expression of differing views at the highest level," Brown said recently.

Too often, he added, he had seen the estimates of one agency or another proved wrong, and therefore he opposes suppressing disagreements too low down in the organization.

"The decisions in the next couple of months will be crucial to the intelligence community as anything since the chapter establishing the CIA in 1947," said one official close to the struggle.

The National Security Council, with Vice President Mondale heavily involved, is supervising the preparation of Presidential Review Memorandum 11 on reorganization of the intelligence community.

The memorandum, describing opposing views and the President's alternatives, will be submitted to Carter late this month, according to informed sources.

At present, the NBA and the NRO, which controls spy satellities, make initial reports to the Pentagon. If they were to come up with important new information and call the CIA first, one source said, a vital defense function would be lost.

The Pentagon is extremely reluctant to lose this control and all parties to the debate are aware of the growing importance of the electronic spying techniques as equipent becomes more sophisticated. The importance of NSA and NRO can only grow.

Turner has potentially valuable allies on the Senate Intelligence Committee, which was formed a year ago to oversee the intelligence community.

Sen. Walter D. Huddleston (D-Ky.) chairs a subcommittee that thas drafted a reorganization plan recommending centralization of control in a Director of National Intelligence.

Huddleston said this week that he was encouraged by President Carter's tone during a May 13 White House meeting attended by Senate committee members.

Huddleston said Carter appeared to agree with the general objectives of creating a strong director for the community but wanted to reserve his opinion until after the Presidential Review Memorandum is completed.

At the White House meeting, Carter also made it clear that he has given Turner a strong mandate to plan to reorganize and reform the intelligence director in glowing terms, according to several who were present.

Brown and Turner get on well personally, according to all accounts, and their face-off over reorganization is the only serious issue that divides them.

The Defense Intelligence Agency would remain a part of the Pentagon under all proposals being debated within the administration.

Less clear, however, is whether the reorganization will call for the head of the community and the head of the CIA to be separate people.

The bill drafted by Huddleston's subcommittee would mandate that the jobs be divided.