When the Moslem month of Ramadan ended early this month, a record crowd of at least 100,000 joyous believers turned out for a mass prayer session in front of President Anwar Sadat's Abdin Palace, hailing the end of their month-long fast.

Above these surging throngs of worshipers rose the usual banners proclaiming the glory of the prophet Mohammed and quoting selected verses from the Koran.

The messages borne by the crowds, however, were not just religious. There was also a strong, if carefully modulated, political undercurrent in the affair that could hardly have pleased Sadat on the eve of his departure for London and Washington.

Many of the green and white banners bobbing over the heads of the wailing faithful bore Koranic quotations selected for their criticism of the Egyptian president's policies, testifying to the growing Islamic fundamentalist movement increasingly challenging Sadat's 11-year rule.

None of the banners was more specific than one proclaiming: "Believers do not take the Jews and Christians as friends." In one sentence it criticized Sadat's policy of seeking peace and friendship with the Jewish state of Israel and at the same time it fanned the flames of religious sectarianism in Egypt, threatening the country's ever-jittery Coptic Christian minority.

But the political messages of the Koranic banners were nothing compared to that of leaflets circulated through the crowds by young Moslem activists from the Gamaat Islamiya or Islamic Associations that are proliferating across this impoverished and overpopulated nation.

Reminiscent of fundamentalist Islamic tracts circulated through Iran in the dying days of the shah's reign, the leaflets protested that Egypt has become a nation "without creed or vocation" where individual egoism, devoid of national and Islamic purpose, aimed only at satisfying "vile instincts and amassing wealth by any means."

The leaflets termed Sadat's peace with Israel "evil" and urged the nation to prepare for a jihad, or holy war, by the eradication at home of "corruption disseminated in the information media, movie houses, leers, usury, nakedness and pursuing insubordination everywhere."

In a country where political opposition is not tolerated, those were strong words indeed. They also represented one more challenge by the Islamic fundamentalists to Sadat's often repeated dictate that he would brook "no politics in religion and no religion in politics."

These militant, if still amorphously structured, Islamic Associations have spread from Egypt's 17 universities and colleges in the past several years to defy Sadat and have become potentially threatening.

Their goal is total transformation of secular Egyptian society into that of an orthodox Islamic republic, where the stern laws of the Koran dictate the morals and government of Egypt's 43 million people. While the fundamentalists have been careful to avoid saying it, it is clear that Sadat, a moderate Moslem, would hardly be allowed to head the Islamic Egypt of their vision.

Sadat has never dealt with political challenges delicately. But the fundamentalist movement, which is generally conceded to constitute Egypt's largest opposition, has put him in a quandary and forced him to tread with uncharacteristic gentleness.

Isolated politically in the Arab word because he signed the Camp David peace accords with Israel, vilified by the Islamic fundamentalist government of Libya's Col. Muammar Qaddafi on his western border, and desperately seeking to reestablish his once lucrative relations with Saudi Arabia's orthodox Moslem rulers, Sadat has acted with great caution against the fundamentalists. He is making an effort not to be accused of warring against Islam.

Ever the astute politician, Sadat has also been aware that the fundamentalism of the Islamic Associations is only the most visible and dangerous sign of a much wider national Islamic revival, attributed to Egypt's humiliating defeat by Israel in the 1967 Six-Day War. That defeat, many Egyptians maintain, was the real end of the pan-Arab ideology with which the late Gamal Abdel Nasser had mobilized the Egyptian people for more than a decade.

The notion of a secular, revolutionary, pan-Arab Egypt died in the Egyptian retreat from Sinai. Although Nasser lived for three more years, he never revived his ideology. It is generally conceded that Sadat, who succeeded Nasser in 1970, for all his cleverness and daring international diplomacy, has failed to provide the nation with anything like an ideology that could unite Egypt. Islam thus began to fill the vacuum.

"A people such as ours, with all its misery, needs an ideology that is emotionally satisfying, capable of giving solace and justification for existence," said Ali Dessouki, a political scientist from Cairo University who in the early 1970s first predicted this Islamic revivalism. "People need something that offers them hope for tomorrow, especially in a country where hope is so scarce."

"Islam has gained so much here," Dessouki insists, "because of the weakness of its adversary: Sadat has simply failed to produce anything that could counter it."

The signs are inescapable of Egypt's religious revivalism, which received a new boost with the rise of Ayatollah Ruhollah Khomeini's brand of fundamentalism in Iran. Mosque attendance in the past several years is way up. Reed prayer mats have become a common sight in the hallways of modern office buildings at prayer times, and Western diplomats have even noted that many of their Egyptian acquaintances who used to enjoy alcoholic refreshments have become teetotalers. Egyptian women, who traditionally have worn more Western dress than any other women in the Arab world, are increasingly seen covering their heads with scarves and wearing long gowns.

Aware of the new social and religious tides, Sadat has sought accommodation. Prohibition has been imposed in most cities and provinces outside of the usual haunts of Western tourists, whose money Egypt increasingly counts on.

A bill to consider replacing Egypt's Napoleonic system of justice, has also been under debate by the People's Assembly since 1977, although like prohibition, there are doubts that Sadat, who controls the assembly, would allow it to be inacted unless he found that he had no other alternative because of the mood of the country.

But the cutting edge of this revivalism remains the Islamic Associations, which within several years have superseded the once-powerful Moslem Brotherhood. After being repressed by Nasser when it tried to overthrow him, the Moslem Brotherhood has reconstituted itself and its journal, Al-Daawa. But its members are considered too cautious, too worn-out and too conservative for the new fundamentalists.

Organized as loosely structured social-welfare clubs at both the faculty and student levels, the Islamic Associations in the past two years overwhelmingly won control of student councils at most Egyptian universities, only to have the nervous academic officials cancel the elections on technicalities.

Since 1979, they have been involved in dozens of violent university riots -- especially in Cairo, Alexandria and Assyut, the three most important institutions in the country -- that have resulted in deaths, injuries and hundreds of arrests.

Sadat's response to this has been anger and frustration. He has flooded the campuses with secret police and has sternly warned the Islamic Associations about their growing politicization. But he has not been able to curb them or their spread from the universities into urban communities.

Most Egyptian and Western analysts of the movement believe these various groups do not have any real coordination or organization at a national level. All agree that for the moment the Islamic Associations are hampered by the lack of any single leader to galvanize the movement into a serious force.

No one, however, is denying that the fundamentalist militants spell trouble for Sadat.

The fundamentalists' pronouncements have already deeply disturbed Egypt's 5 million Copts, reviving ingrained Christian nightmares of the sort of pogroms they perodically suffered in the Middle Ages at the hands of various Arab rulers.

The increased Coptic-Moslem tension in the past year -- including religious riots in a suburb of Cairo that left approximately 70 dead and a more recent hand grenade attack on a Coptic wedding early this month -- are blamed by some on the Islamic Associations, if not directly at least because of their angry preachings.

The government also suspects that many of these fundamentalist groups may also be encouraged by foreign forces, Qaddafi being the prime suspect. But so far the government has no convincing proof to substantiate the charges.

Still the political brashness of the Islamic Associations, as demonstrated before the Abdin Palace, is enough proof that Sadat has good reason to be concerned.

"Egypt is a boiling pot 24 hours a day," said one professor from Alexandria. "There is a lot of frustration, and no one knows when it will explode, or against whom."

If it does explode -- for political or economic reasons -- no one can doubt that the fundamentalists will be a force to contend with.