When J. Jackson Walter agreed to come to Washington in 1979 to oversee the Carter administration's new post-Watergate ethics law, he figured it would be easy.

"It looked like a little tiny law that you could understand quickly," he said. "That turned out to be a mistake."

The 41-year-old lawyer has found himself in the midst of wide-ranging controversies involving Attorney General William French Smith, CIA Director William J. Casey, former national security affairs adviser Richard V. Allen and other top officials. Through a mixture of persistence and persuasion, he has tried to weed out possible conflicts of interest throughout the bureaucracy.

Walter is announcing his resignation today as director of the Office of Government Ethics, at a time when many in the Reagan administration are talking about scaling back the ethics law. In Walter's view, the resentment many officials feel at his scrutiny is more than balanced by the need to throw a spotlight on their private finances.

"It's hard to make a big decision stick in this town, because someone is always trying to tarnish the decision-maker," Walter said. "If someone can claim that your wife's second cousin had a financial interest in the decision, you've got a one-day wonder of a story."

In one sense, the lanky attorney with horn-rimmed glasses has enjoyed considerable power, for no Senate committee would even contemplate confirming a presidential nominee until Walter's office has approved the appointee's financial disclosure statement.

During the Reagan transition, Walter essentially became a traffic cop for hundreds of high-level appointments, a process the White House says discouraged many talented people from serving in the government.

But the scholarly Walter prefers to view the process as one of consultation, not confrontation. "I've had to tell the White House sometimes that we would have trouble certifying someone unless he does such and such," he said with customary diffidence. "It's our responsibility to bring every government official into compliance. Sometimes we have to say, 'You're just not going to be able to receive that money from XYZ Corp.' "

That, essentially, is the message he gave in May when he wouldn't sign Attorney General Smith's financial disclosure form for his first year in office. Walter initialed the form only when Smith, after days of negotiation, agreed to return a $50,000 severance fee he had accepted from a California steel company. Typically, Walter has declined to comment on the incident.

But it points up what some see as major weaknesses in the way the office was set up. There are no sanctions a director can impose if he doesn't approve an incumbent official's statement, and he doesn't have the authority to audit the financial forms.

"Basically, OGE serves as a law firm to the agencies; it is not enforcement-oriented," said Susan Collins, a Senate staffer whose subcommittee oversees the office. When several top officials were found to have omitted key information from their statements, she said, "they just said that they forgot."

Still, it has become an annual ritual each May for 14,000 political appointees, top civil servants, judges, members of Congress and their staffs who have to disclose their income, debts, gifts, stock and other assets, along with those of their spouses and minor children. Walter received requests for 771 of these reports last year, mainly from reporters, law firms and public interest groups.

Walter suggested that the finances of career officials perhaps should be kept private, in part because most reporters aren't interested in them. At the same time, he said, "The mere fact of filling out that form and knowing it's going to be publicly available is a deterrent."

The 1978 Ethics in Government Act also placed tighter restrictions on how former officials can deal with their previous agencies. Walter's main role, however, is to write advisory opinions for companies on whether their employes are passing through the "revolving door" too quickly.

Walter shouldn't have such problems, since he is joining the National Academy of Public Administration, a research group that does no lobbying. A graduate of Yale Law School, he was in charge of business regulation in Florida when Reuben O'D. Askew was governor. Policing included such areas as fraudulent land sales and bribery of liquor inspectors. Askew recommended him to Jimmy Carter. President Reagan will have to name a successor.

Walter has resisted the impulse to expand his Washington empire, getting by with a 25-member staff and a million-dollar budget. As for whether he will miss the excitement, Walter smiles slightly and says: "It's like having a seat at the 50-yard line to look at the conduct of the executive branch."