Sweden acknowledged yesterday that it conducted secret underground nuclear explosions using weapons-grade plutonium in 1972, but denied published reports that it now has the capability to produce nuclear weapons.

The acknowledgment was made in Stockholm by government defense research specialists and confirmed here by a Swedish Embassy spokesman. It said Sweden had halted work on producing an atomic bomb in 1957, but scientists involved in that effort had continued to seek to develop effective defenses against nuclear attack that involved the underground explosions disclosed yesterday.

The Swedish defense research specialists emphasized in Stockholm that the amount of plutonium used in the tests had been about a gram, far short of the amount needed to make a nuclear bomb.

News agencies reported from Stockholm that the initial disclosure of the tests, which came Thursday in Ny Teknik, a reputable Swedish technical journal, provoked a political controversy. Nuclear arms-testing would be illegal in Sweden, where the parliament in 1957 banned research geared toward producing a nuclear bomb.

Sweden, which considers itself a neutralist country, signed the Nuclear Nonproliferation Treaty in 1968, thereby pledging not to acquire nuclear weapons production capability.

Social Democratic Prime Minister Olof Palme, who has played a leading role in seeking nuclear-free zones in Europe, said at a press conference that "no nuclear weapon has ever been constructed or exploded in Sweden."

But he added that it was sometimes hard to define the limits of "research aimed at protecting the Swedish population against nuclear arms," which Swedish law allows.

At present only five countries -- the United States, the Soviet Union, China, France and Britain -- are in the so-called "nuclear club" of countries that openly have nuclear weapons.

Sweden has not generally been listed as a country developing nuclear weapons capability, and the acknowledgment yesterday appeared to catch nuclear weapons specialists in Washington and London off guard. The State Department made no comment.

The secret research was conducted by a group of Swedish scientists who had launched an effort to build an atomic bomb in the early l950s, a Swedish official in Washington said.

"In the mid-1950s, we were on a par with France in technical development in the atomic field," Palme said in his press conference. "But while they decided to go on and acquire atomic weapons, we subsequently decided against that."

The embassy official here described the research that was carried out after 1957 as "protective," aimed at defending neutral Sweden against nuclear attack, and not at building nuclear weapons. "The whole thing was stopped in 1972," he stated, but he would not say what the research produced.

The Associated Press reported from Stockholm that Tage Erlander, Sweden's prime minister in 1957, acknowledged authorizing the program but said he doubted that it violated the parliamentary ban because it was carried out for "nonoffensive purposes."

"We conducted a certain research in order to obtain atomic weapons if it would be necessary," Nils Skold, a former Swedish Army official, told a Stockholm newspaper.

Palme yesterday instructed Defense Minister Anders Thunborg to look into the reports after the opposition Center Party, which is antinuclear, demanded an investigation.

Thunborg yesterday called reports that Sweden has the capability to build nuclear weapons "utterly false." He said the government and parliament "have taken a firm stand not to produce nuclear arms."

The article in Ny Teknik said Sweden's National Defense Research Institute started its attempts to build a bomb in 1952 and continued throughout the 1960s and 1970s, despite the parliamentary prohibition. The program was designed to allow Sweden to build 10 bombs a year of the size dropped on Nagasaki, starting at very short notice, according to the article.

The research culminated in 1972, with 10 small underground plutonium explosions in a defense research laboratory in Solna, a Stockholm suburb, the article said.

It said that between 1957 and 1965, the Swedish government secretly supported the nuclear research with "millions of crowns," the Swedish currency.

Blueprints for Sweden's atomic arms-producing capability were so complete by 1957 that even the probable radioactive fallout had been measured, the article said. A year later, it said, the government gave the Swedish defense institute the go-ahead to produce nuclear arms on a small scale.

The article said the institute then developed the nuclear reactor Agesta, which was designed to produced 15 to 18 pounds of weapons-grade plutonium a year -- or enough to manufacture up to 10 tactical atomic weapons.

By 1965, it said, Sweden had developed atomic-bomb capability. But, it said, the efforts at production lost momentum during the late l960s due to rising costs and uncertainty of the directions other nuclear powers such as the United States and the Soviet Union would take.

Christer Larsson, who wrote the report, said Sweden built a nuclear-pulse generator that would trigger a warhead and a prototype nuclear implosion device.

"As of today, Sweden should be able to build a bomb in two years," an official at the Stockholm International Peace Research Institite, or SIPRI, estimated in a telephone interview. "It would be a simple weapon but a functional one." SIPRI is a nonprofit organization that acts as a watchdog to nuclear powers.