PARIS, NOV. 1 -- Confronted by American opposition and internal splits over its decision to move closer to Libya's Col. Moammar Gadhafi, Algeria is backing away from a plan for an immediate political union with Libya, diplomatic sources reported today.

Instead of agreeing to the union of the two Arab nations that Gadhafi has insistently sought, the Algerians are asking the Libyans to join a 1983 friendship treaty among Algeria, Tunisia and Mauritania, according to these sources.

Although the union, which was to have been announced today, has been frustrated, Gadhafi appears to be making significant progress in his campaign to break out of the diplomatic isolation that the United States has sought to impose on him for his support of international terrorism and his military adventures in Africa.

In the past month, Libya has signed a series of economic agreements with Algeria that could form the basis for a future union, reopened its border and restored diplomatic ties at the consular level with Tunisia after two years of hostility, and reached a tacit cease-fire with French forces in Chad.

Algerian President Chadli Bendjedid reportedly has rejected suggestions that he publicly abandon his drive for a rapprochement with Gadhafi, which was denounced by a State Department spokesman after details of the union plan were published in The Washington Post on Oct. 7.

But Bendjedid, a cautious leader who frequently has to act as a mediator among the factions within his government and the ruling National Liberation Front, did not give in to Gadhafi's insistence on a union announcement on the Nov. 1 anniversary of the beginning of Algerian armed resistance to French colonial rule, according to diplomats.

The leader of the internal opposition to formal political rapprochement with Libya is Foreign Minister Ahmed Taleb Ibrahimi. In newspaper interviews last month, Taleb Ibrahimi endorsed -- as an alternative to union -- Libya's entry into the loose entente formed by the 1983 treaty.

Gadhafi has not responded publicly to this suggestion. Diplomatic sources report that privately he continues to push for union.

The 1983 agreement was originally intended to provide Tunisia with support against Gadhafi's threats to destabilize the government of President Habib Bourguiba.

Accounts in Arab publications in recent days have identified Mohammed Cherif Messaadia, the second-ranking figure in the National Liberation Front, as the principal supporter of union with Libya.

Washington has dealt carefully with Algeria in voicing its opposition to extending any political legitimacy to Gadhafi, avoiding direct pressure tactics against the sensitive regime in Algiers.

But U.S. displeasure at any reconciliation with Gadhafi has been voiced in far more direct terms to the weakened Tunisian government, according to Arab and western diplomatic sources.

Bendjedid had provided Bourguiba, who is now 84, a commitment in 1984 to help Tunisia in the event of Libyan aggression or subversion. Closer relations between Algeria and Libya leave Tunisia little choice but to accept efforts by Gadhafi at fence-mending, according to Arab diplomatic sources.

These sources report that work is due to continue on the Algerian-Libyan union agreement, which reserves national sovereignty on foreign affairs and defense matters to each government and rules out a "fusion" of the two states. It would, however, establish common political institutions.

When the United States launched an air strike on Gadhafi's Tripoli headquarters in April 1986 following the bombing of a discotheque frequented by American servicemen in West Berlin, the Libyan leader received only the mildest form of pro forma support from most other Arab nations.

His gradual realization of his isolation and a series of military defeats inflicted on him by Chadian forces last summer have caused Gadhafi to strike a more conciliatory pose in dealing with other nations, diplomats report.

Since recapturing the disputed Aozou Strip along the Libyan-Chadian frontier in August, he has not launched new attacks to regain territory lost to the south and has not taken hostile action against French troops there.

This has caused French analysts to conclude that he is avoiding confrontation for the time being. Both President Francois Mitterrand and Prime Minister Jacques Chirac, likely contenders in next year's presidential elections in France, are content to let Gadhafi sit quietly in the Aozou strip until after the election if he does not seek wider confrontation, French officials report.

U.S. diplomats do not accept this analysis of Gadhafi's intentions in Chad, pointing to continuing Libyan overflights of French positions there.

Since coming to power in 1969, Gadhafi also has struck short-lived union agreements with Morocco, Egypt, Syria, Sudan, and Tunisia. The Libyan leader's erratic behavior and failure to deliver on economic promises usually have been key factors in the repeated failure of his efforts to enlarge his political base through agreements with other Arab countries.

But Bendjedid reportedly is determined to avoid the pattern of rush to union and then rapid dissolution. While Algerian officials generally refuse to talk to western diplomats about their talks with the Libyans, they do suggest that they are patiently and persistently trying to find a useful role for Gadhafi in North Africa that will keep him from more destructive adventures abroad.