The State Department plans to build a multistory tower in downtown Cairo for an expanded U.S. Embassy that some American diplomats fear will turn into an ostentatious and untimely symbol of their rapidly growing role in Egypt.

"The whole thing just doesn't make sense," said one high-ranking member of the embassy staff. "I'm not sure that thinking about a 20-story projectile into the sky is what we ought to be doing right now."

Nobody contests the need to find more space for the swelling staff assigned here to administer a $1 billion-a-year aid program, conduct increasingly close diplomatic relations and carry out what has become a long-term project to refit the Egyptian Army and Air Force with the most modern American equipment. The latter requires extensive training by U.S. experts.

But for some diplomats, building an office tower -- actually 17 floors above ground -- replete with a ceremonial drive and reflecting pools is not the most discreet way to do it in an era of anti-American sentiment. They cite the Tehran hostage situation, the U.S. Embassy sackings in Pakistan and Libya and the withdrawal of American dependents from several Persian Gulf countries.

The bureaucratic momentum of a decision taken in Washington to build a new embassy is rumbling along on engineering and architectural grounds, rolling under such diplomatic considerations as keeping the American profile in Egypt low to avoid attracting Islamic or other protests, these critics say.

Construction of an elaborate building also underlines the U.S. expectation that President Anwar Sadat's policies -- or those of whoever follows him -- will continue to require a large American staff here.

This marks a sharp departure from guidelines laid down by former ambassador Hermann Eilts. He headed six U.S. diplomats when he took over after the 1973 war but left last year with a staff of 190, warning that U.S. visibility here "could get out of hand."

One of the top aides to current Ambassador Alfred Atherton suggested at a recent embassy staff meeting that the United States will be making a "political statement," underlining its dominant presence here by erecting the tower -- which will compete for attention with other new buildings on the Nile-side skyline.

According to a participant in the meeting, Atherton responded that there is little alternative, given the pressing need for more office space and the limitations imposed by finances and the size of the embassy compound.

The embassy staff, comprising 415 Americans and 315 local office employes, is forecast to increase by roughly 10 percent over the next four years. This does not include U.S. military training personnel, who will be stationed at air bases and Army camps.

The building is budgeted to cost the equivalent of $30 million but is to be paid for almost entirely in Egyptian pounds that have accumulated through U.S. food aid sales.

Architect for the project is the Washington firm of Metcalf and Associates, which has an office here and is also to be paid in pounds, according to U.S. officials.

Embassy spokesman Alan Gilbert said demolition is scheduled to begin in July to make way for the tower. When the building is completed, probably in 1983, it will replace the gracious former residence that serves as the present chancery, and several other buildings on the traingular embassy compound.

The need to keep working while construction goes on -- Cairo rents make temporary quarters expensive -- has helped determine the shape of the new embassy, Gilbert said. As many embassy employes as possible will use offices at one end of the compound while the tower rises at the other. Employes of the Agency for International Development, the embassy's largest contingent, will move into several floors of a nearby office building during the week.

Architect William Metcalf's plans, still being debated and altered, call for two basement floors, a broad two-story base building and a slope-roofed tower jutting up another 15 stories. It will be tallest embassy in Cairo, overshadowing the nearby British and Canadian embassies, and will rise over the 14-floor landmark Shepherd's Hotel, 50 yards away on the Nile.

It will be far from the tallest building in the city, however. A nearby office building will rise several stories above it. The 40-story Ramses Hilton Hotel being built a five-minute drive down the Nile will command a more prominent place in the cityscape, as will other buildings already built or planned for the area.

In any case, Gilbert said, a tower design responds to needs for efficiency, security and esthetics in addition to making construction possible without relocating the entire embassy staff in high-rent offices.

"There has to be some uniqueness to the design," he said. "It can't look like Shepherd's across the street. A tower makes a statement."

The compound, according to plans as they stand now, also will include new tennis courts and a swimming pool, replacing facilities constructed after relations resumed in 1974. Original designs foresaw an interconnected series of reflecting pools around the ceremonial entranceway, but Metcalf's team has been asked to provide more green space.

The drive is said to be necessary to provide elegant entrances for ministers coming to call. But one U.S. diplomat remarked that ministers do not come to ambassadors; ambassadors go to them.

"Have you ever seen a minister in the embassy?" The diplomat asked.