Although he failed in an earlier effort, Sen. Gaylord Nelson (D-Wis.) said yesterday that he intends to try again to stop the costliest federal water project in history.

Nelson said in a Milwaukee speech that he will introduce a bill this month that would kill the Tennessee-Tombigbee Waterway, a $1.8 billion barge canal being constructed in the South.

The Army Corps of Engineers project in Mississippi and Alabama, about 30 percent complete, would receive another $165 million for construction under President Carter's fiscal 1980 budget.

Nelson said his bill to "deauthorize" the 260-mile waterway will have bipartisan support, and that he will push for hearings before mid-March in the Senate Environment and Public Works Committee.

Long a favorite of southern members of Congress, the project is to link the north-flowing Tennessee River with the south-flowing Tombigbee River to create a shorter route to the Gulf of Mexico for commercial shippers in the Midwest.

Nelson said yesterday that the canal project is "the biggest pork-barrel boondoggle of them all It is 364 percent over budget, is is already obsolete, while not yet one-third complete, it is an economic and environmental disaster -- an absolute waste of money"

He attempted in 1971 to delay the Tennessee-Tombigbee when the Nixon administration was seeking the first construction money for the project. A Nelson amendment to restudy the project was defeated.

Since then, however, the Tenn-Tom has become increasingly controversial, and its cost, estimated in 1971 to be $364 million, has escalated to $1.8 billion, and is expected to run higher before work is finished.

A coalition of environmental groups and the Louisville and Nashville Railroad sued the corps in an effort to stop the Tenn-Tom on the grounds that the Army violated the law by building a 300-foot wide canal rather than the authorized 170-foot width.

Trial of the case was completed 10 days ago in a federal court in Greenville, Miss., and a judge's decision is expected soon.

A Washington Post report last week disclosed that the corps had justified the cost overruns with a benefit cost analysis based on shipping data that was erroneous.

Potential shippers named in the "confidential" corps survey said in interviews that they did not intend to use the waterway as had been reported in the survery.