The faculty of Oxford University delivered an unprecedented snub today to one of the school's most famous graduates -- Prime Minister Margaret Thatcher -- by overwhelmingly rejecting a proposal to confer an honorary doctorate on her.

More than 1,000 senior members of the teaching and administrative staff of the famous university jammed the 17th century Sheldonian Theater for a two-hour debate and then voted 738 to 319 to deny Thatcher, Britain's first woman prime minister, a distinction that has been bestowed on every Oxford-educated prime minister since 1946.

Thatcher, who graduated with a degree in chemistry from Oxford's Somerville College in 1947, would have received an honorary doctorate of civil law, as proposed by the ruling council of the faculty parliament.

The vote reflects strong opposition within the academic community to cutbacks in education funding by the Conservative government and some opposition to Thatcher's politics in general, as revealed in interviews here today.

But others, such as Lord Quinton, president of Trinity College at Oxford, said the degree should not have been withheld. "Why should education be singled out rather than health or relief of poverty," he said in arguing that there was nothing wrong with across-the-board cuts by a cost-cutting government.

Lord Blake, the provost of Queen's College and a Thatcher supporter, called the action "petty, spiteful and vindictive."

A prevote petition opposing the honorary degree and signed by almost 300 Oxford dons, as professors are called, alleged that Thatcher's government "had done deep and systematic damage to the whole public education system in Britain, from the provision for the youngest child up to the most advanced research program."

It said "it would be inappropriate" for the school, which is "widely perceived to stand at the pinnacle of British education," to respond "by giving its highest token of approval."

Peter Pulzer, a professor of government who led the rebellion against honoring Thatcher, said tonight the vote was "very significant. This is not a radical university, not an ideological university. So I think we have sent a message to show our very great concern about the way education policy and funding is going in this country. . . ."

A spokesman for Thatcher said later that it was gracious of the council to propose the degree. However, if the university "does not wish to confer the honor, she is the last person to wish to receive it."

While refusing to honor Thatcher, the meeting today approved without a vote an honorary degree for Italian socialist President Alessandro Pertini. The university in the past also has honored former West German chancellor Willy Brandt and the late Indian prime minister Indira Ghandi.

The only other person rejected by the university was former Pakistan president Zulfiqar Ali Bhutto, in 1976, because of violence during the strife that accompanied the establishment of the nation of Bangladesh out of East Pakistan.

The London Daily Express said today that, contrary to critics' claims, spending on all forms of education has risen by 1 percent, after inflation, during Thatcher's 5 1/2 years in office.

Oxford is widely viewed as a symbol of the British ruling establishment, generally conservative, although more moderate than Thatcher. But Thatcher, the daughter of a grocer, is not the favorite of much of the traditional elite in Britain.

Although polls continue to show Thatcher as the most respected political leader in Britain today, she does not generate affection among voters, and today's episode is another reflection of how strongly she divides segments of the population.

Thatcher's government has come under sharp attack from educators and students who prize Britain's tradition of tuition-free higher education. Her ministers have had to back away from proposals to make more well-off British families pay a portion of those costs and from plans to reduce further student living-cost grants.