The Federal Aviation Administration proposed yesterday to ban within two years a jet engine part that has shot from planes in flight at least 16 times.

One of the failures contributed to or caused the Sept. 6 takeoff crash of a Midwest Express jetliner in Milwaukee that killed all 31 people on board.

The ban would be preceded by a series of intensified inspections to make certain the part will work safely until replaced. The FAA proposal, formally released yesterday after weeks of meetings with the airline industry and the engine manufacturer, would take effect after a 45-day comment period unless it is amended or withdrawn.

Replacement of the parts is expected to cost the industry $43 million.

The engine involved is the JT8D, manufactured by the Pratt & Whitney division of United Technologies Corp. The JT8D is the most widely used jet engine in the world and powers two-thirds of the domestic fleet. One model or another is on every Boeing 727 and most 737s, and on all models of the McDonnell Douglas DC9, including the MD80 series, a DC9 derivative.

About 700 U.S. airplanes could be affected, but the inspection schedule is not expected to disrupt service.

The suspected part is called a spacer. Spacers are attached to the central rotating shaft of a jet engine, which consists of three sections -- a compressor, a combustor and a turbine. Air coming through the intake is forced through a series of compressor "stages" consisting of one rotating and one static set of blades that look somewhat like fan blades. The compressed air is mixed with fuel and ignited in the combustor section and exhausted through turbine blades, which rotate the shaft and the compressor.

Spacers separate the compressor stages. There are two kinds of spacers in JT8Ds. The older model has a removable sleeve, while the newer is a single part with no sleeve.

All spacer failures have occurred on engines with the removable sleeve, usually because of undetected corrosion and cracking of the metal under the sleeve. In eight failures, the flying spacer part, which might rotate as fast as 8,000 revolutions per minute, penetrated the armor-like casing around the compressor but stayed within the engine's outer covering, called a cowling. In the other eight cases both the casing and cowling were penetrated.

In Milwaukee the flying spacer was found alongside the runway. The plane crashed almost immediately after lifting off the runway, but first the pilot had time to radio, "I have an emergency."

Investigators have established that one engine failed at liftoff or just before; the plane climbed briefly using its other engine but then, for reasons not fully understood, went out of control.

It is estimated that 12,000 to 13,000 JT8Ds are in service worldwide, and about 3,700 of them still have the older two-part spacers. Many spacers have been replaced as the engines have undergone scheduled inspections and renovations.

The FAA's engine maintenance experts are known to be concerned that less-than-vigorous inspections may be at the root of the problem.

Consequently, the FAA has ordered an extensive inspection of jet engine repair facilities operated by major airlines and independent overhaul companies. That inspection is to begin in January and last two months.

The FAA's proposed order will require inspection of any JT8D having 1,700 or more cycles (a cycle is one takeoff and one landing). The inspection consists of running an electrical current through the spacer and measuring it. "If there are any discontinuities, they will show up," said Jack A. Sain, director of aircraft certification for the FAA's New England Region, which is responsible for engine matters nationwide.

The two-part spacer would have to be replaced the next time the engine receives a scheduled inspection, and all must be replaced within two years or 4,000 cycles.

The airline industry has expressed concern that spare parts might not be available, but Sain said, "We have the assurance of Pratt & Whitney that the parts will be available consistent with the inspection schedule."