Sen. Daniel K. Inouye (D-Hawaii), acknowledging that he had made "an error in judgment," said yesterday he will seek to have Congress rescind an $8 million appropriation for Jewish schools in France that was included at his request in last year's omnibus spending legislation.

Inouye, who had come under a barrage of criticism for sponsoring the appropriation designed to help build schools in France for Sephardic Jews who had fled North Africa, offered a spirited defense of his actions during a lengthy speech on the Senate floor yesterday. But Inouye said that he has asked a colleague in the House to introduce legislation overturning the appropriation because continuation of the controversy would harm the Senate.

"I continue to believe that what I have done is appropriate," said Inouye, "but to fight the criticism and to prolong the controversy in order that I might win vindication would risk a further loss of public confidence in the Senate."

Inouye's insertion of the $8 million appropriation into a $604 billion catchall spending bill that was passed by Congress and signed into law by President Reagan in late December became a lightning rod for criticism of the numerous special provisions in the measure.

News accounts at the time noted that Inouye had received a $1,000 campaign contribution from a board member of the New York-based Ozar Hatora organization that has established schools in France to serve Jews from North Africa. State Department officials, speaking anonymously, criticized the appropriation.

Inouye defended the appropriation as a legitimate means of helping refugees. He said he was unaware of the campaign contribution, and insisted that the earmarking was done in the open with the full knowledge of the State Department. The department raised no objections, he said.

"I did not sneak a pet project of a campaign contributor into {the legislation}," Inouye said. "I do not behave that way . . . . I was not aware of any opposition from unnamed State Department refugee officials. Only after the president signed the bill into law did these officials -- under a cloak of secrecy -- begin to make their spurious charges.

"I was disappointed, hurt and angered by the accusation that I had supported the earmarking because of a $1,000 contribution to my reelection campaign," he said. "Never before have I been accused of taking 30 pieces of silver."

The U.S. and French governments and the United Nations do not classify the North African Jews as refugees. But Inouye said that the Sephardic Jews living in France are as deserving of U.S. refugee assistance as other groups because they have yet to be assimilated into French society and are "subject to abuse and discrimination."

"Persecution is persecution, whether it be against Baptists in the Soviet Union, Protestants in North Korea, or Catholics in Poland," he said.

Just before Inouye's announcement, the American Civil Liberties Union filed suit against the State Department in U.S. District Court in New York, seeking to block the use of the funds.

The ACLU suit charged that the expenditure violated the Constitution's prohibition against establishment of religion. An ACLU representative in New York said the curricula of the Paris schools included mandatory religious instruction.