President Carter has decided to defer production of neutron weapons for now but retain the option to build them later, "influenced by what the Soviets do, administration sources said yesterday.

Carter's long'awaited decision on the new generation of nueclear artillery shells and Lance missile war-heads will be disclosed at a North Atlantic Council meeting in Brussells today sources said. The council is NATO's supreme gorvernment body.

Carter himself is expected to make a statement on his decision here in Washington this afternoon.

The NATO body will also be told the United Stated s plans to improve its nuclear artillery systems now deployed in Europe.

The now-deferred neutron artillery shells were designed to replace aging eight-inch and 155-millimeter shells that have been in Europe for almost 20 years.

The proposed modernizing program, sources said, would be sey up produce shells that could be used for either a neutron or a traditional nuclear version of the weapon.

Because of the complexities involvrd in building such weapons it would be a year or more from the start of such a program before a decision would have to be made as to what kind of shell it would be.

The Carter decision leaves in doubt whether neutron weapons will ever be built but avoids cancellation of the program.

There will be no specific proposal on arms tradeoffs made to the Soviet Union and no time limit for the neutron deferral, sources said.

But, they added, a continued upgrading of Soviet or Warsaw Pact forces on the NATO front or a refusal by the Russians to enter into any proposed future negotiations could trigger the order to build neutron shells.

"The option to go ahead is a real option," oron shells.

"The option to go ahead is a real option," one administration official said.

"The monkey is now on the Soviet's back," was the way one Carter aide optimistically put it.

The Carter formulation appears to fit the demands of West German Chancellor Helmet Schmidt, who, beginning last December, sought some attempt at an arms tradeoff with the Soviets before he would publicly agree to deployment of neutron shells of warheads on his country's soil.

Problems over the past months in getting Schmidt and his govrernment guarantee that they would support production and deployment on German soil were one factor earlier plan to do ahead immediately with neutron production.

Sources said yesterday that Carter now believes that Schmidt and other NATO leaders would support a future production decision should one be seemed necessary based on Soviet actions.

The decision "should be satifactory the allies," an administration offial said yesterday.

In the words of another Carter aide. The decision really represents the illegible consensus we could get from NATO."

Carter aides also hoped that the decision would cool down some of the opposition that had developed on Capitol Hill earlier this week based on woed that Carter planned to cancel the program.

Carter aides also hope today's announcement will be diminish criticism that has developed at home and abroad over the manner in which the President reached the decision.

The now-deferred neutron shells and warheads would be, if built , the first tactical weapons designed to kill enemy troops primarily through radiation rather than destroy their tanks and equipment a current nucler weapons do by heat and blast.

Because neutron weapons cut down on blast and heat,porponents argue they cause less collateral damage to towns and cities adjacent to the battlefield.

Opponents argue, however, that field commanders would be more likely to use them than current weapons and thus they lower the threshhold leading to nuclear war.

Production of the weapons was first approved by President Ford in November 1976-a decision that was kept secret at the time and not expected to be made public until the weapons were deployed with NATO forces in Europe.

Last June, however, The Washington Post first disclosed that neutron weapons production was to begin.

Carter, after first acknowledging he had not know about the weapons gave his initial support to them by requesting congressional approval for their production.

At the time, however, he said he would withhold final approval, pending withhold final approval, pending consultation with NATO allies on whose soil they would be deployed.

Existence of the weapons and disclosure that they were designed to be used on West German soil caused a political uproar in that country.

Opposition grew in other West European countries, fanned in part by Soviet attacked on the new weapons.

Carter, who had expected quick NATO support found he had to delay a planned August go-head decision.

Negotiations to draft the public statements Carter wanted on production and deployment from the Nato alliance dragged oThe White House was not getting the deployment assurances it wanted, partucularly from the West Germans.

The Netherlands recently became the first country whose partiament debated and voted on the issue and it came out against the weapons.

Against that atmosphere, Carter several weeks ago took a close look at his initial production decision and tentatively decide there was no reason to go ahead.

There was no certainty that if he ordered production, the NATO countries would accept their deployment. And without that assurances, Carter aides say, neutron weapons were no bargain chip with the Soviets.

Public statements over the past month calling on the Soviets to offer something to halt U.S. neutron production were answered only with announcement that they would not build neutron weapons of their own.

Carter'sturnabout was communicated to the Germans with a request for their views. The response, initially, was concern for the sharp turn in direction.

Their reaction, heightened by publication of storeis that Carter planned to cancel neutron weapons, however, was to put them closer to accepting deployment than they had been before. Thus, administration aides believes, should the President be forced by Soviet action to turn to the neutron option, less trouble is expected in gaining German support for both the weapons' production and deployment.