Sen. Russell B. Long (D-La.), a powerful, colorful and wily lawmaker who left a major imprint on the nation's tax laws as chairman of the Senate Finance Committee for 16 years, announced unexpectedly yesterday that he will retire in 1986 after 38 years in Congress.

Long, 66, son of the legendary Huey P. Long and one of the last of the Senate's great southern barons, told a hastily called news conference that he simply decided it was time to retire.

"Every senator should decide for himself at what point he thinks he should retire from the Senate if he has the good fortune to live his term out. After 36 years here I've made that decision. It's that simple," he said.

"I've been thinking about it a long time, up to now keeping my options open. But I decided over the weekend that I would announce my decision, so that's it," he added.

Long's surprise announcement was another blow to Democrats' hopes of recapturing Senate control in 1986 when Republicans are expected to have difficulty defending their 53-to-47 edge in the chamber.

Rep. W. Henson Moore (R-La.), who has represented the Baton Rouge area for the past decade, is considered a strong contender to succeed Long, especially because he will not have to run against the famous Long name.

Most Democratic House members from Louisiana also are considered possible candidates.

While Republicans will be defending nearly twice as many seats as Democrats in 1986, Democrats have several vulnerable seats of their own, including that of Sen. Thomas F. Eagleton (Mo.), who has also announced his intention to retire. Long's announcement compounds their problems.

In a statement after the news conference, Long said he was making an early announcement of his retirement so others could get an early start on their campaigns.

He also denied that concern for his reelection was a factor. He said recent polls showed that 74 percent of Louisianians viewed him favorably and that 59 percent said they thought he should be reelected.

At his news conference, Long spoke with strong emotion about his love for the Senate, where he ranked second in seniority behind John C. Stennis (D-Miss.), 83.

In his statement, Long said he does not know what he will do after leaving the Senate but added, "So long as I live, I shall take an interest in public affairs and do my bit to sustain the government of this, the greatest free nation in history."

As chairman of the Finance Committee from 1965 until Republicans took Senate control in 1981, Long was the dominant Senate figure on tax policy, combining a mastery of parliamentary skills with a keen sense of timing and even keener knowledge of tax-law intricacies.

A populist by inheritance but sympathetic to corporate interests, he was a faithful protector of Louisiana oil and gas interests. Ever flexible, he was a fabled filibusterer against early civil rights laws but eventually took a strong position in support of extending the Voting Rights Act in 1981, reflecting the state's gain in black voting strength.

Elected to the Senate at age 29, he had to wait until he became 30 to be sworn in. Had he run for reelection and served six more years, he would have exceeded the Senate's service record of 41 years and 10 months, served by the late Carl Hayden (D-Ariz.).

Long's father Huey, a populist and purveyor of a wealth-redistribution program, built a powerful political organization in Louisiana, which he served as governor and as U.S. senator from 1928 until his assassination in 1935. His wife succeeded him in the Senate.

Russell Long's uncle George served in the House from 1953 to 1958, and his uncle Earl was Louisiana governor three times. A distant cousin, Rep. Gillis W. Long (D-La.), died Jan. 20, shortly after starting his eighth House term.