In an indication that the Reagan administration will continue an activist federal role in prison reform litigation, the Justice Department today gave near-total support to a lower court ruling that the overcrowded Texas prison system is in violation of the Constitution.

But in oral argument before the 5th U.S. Circuit Court of Appeals, Assistant Attorney General William Bradford Reynolds said the department will continue to seek a negotiated settlement of the case while the appeal continues.

The Texas suit is one of 28 prison cases involving the Justice Department. Because the Texas prison system is the largest in the nation and because the lower court ruling was so detailed in its remedies, the case could influence prison litigation throughout the country.

Attorney General William French Smith and other Justice Department officials have indicated they favor a less active role in prison litigation. But in his statement today Reynolds argued that U.S. District Court Judge William Wayne Justice was correct in finding that conditions in Texas prisons violated the Eighth Amendment and said the government approves of nearly all the changes he ordered.

After his statement, Reynolds told reporters, "This case obviously represents administration policy."

Texas Attorney General Mark White, who charged that the state prison system has been "under judicial assault for 10 years," said he was disappointed by the government's presentation today. "I didn't think his Reynolds' oral argument was all that good for the state," White said, but added he hopes the negotiations that have been going on several months would lead to a settlement.

William Turner, attorney for the prisoners, said he was pleased. "I'm very happy that the government has stuck by its guns and that the change in political administrations has not dampened their enthusiasm for the rights of prisoners."

The Texas case began in 1974, and the trial was conducted in 1978-79. It was one of the longest civil rights trials in history, and controversial in a state that has prided itself on having one of the best prison systems in the country. But Judge Justice found that overcrowding was so severe that it created a climate of fear and violence that could not be tolerated under the Constitution.

He ordered what would amount to single-celling of prisoners, elimination of building tenders, or inmate guards, improved medical care and other changes.

The federal government intervened in behalf of the inmates, and Texas officials, led by Republican Gov. Bill Clements, had hoped they could persuade the Reagan administration to back out of the case once the state had agreed to certain changes.

But continuous efforts to reach a settlement have failed. Those talks continued Thursday afternoon after the two sides had arrived in New Orleans. But Reynolds' statement to the three-judge panel today that he has been "encouraged" by the discussions was the only sign of hope for the state so far.

Texas officials took encouragement from a recent Supreme Court ruling in an Ohio case that found that double-celling by itself did not violate the Constitution, and they presented in today's arguments a generally rosy picture of life in Texas prisons.

The Texas lawyers attacked Judge Justice for believing the prisoners but not prison officials, and said his remedies could wreck the system.

But the government and the inmates' attorneys argued that the Texas case differs from the Ohio one in part because overcrowding affects all other conditions, from security to medical care. They also said Judge Justice could order specific changes in the system because the state had made no effort to.

"The system was unwilling to do anything about the problems without a court order," Turner said.