Prime Minister Margaret Thatcher is at loggerheads with major European allies over retaining short-range nuclear missiles, and some say the issue that has split NATO could cause permanent damage to the alliance.

West Germany wants the United States and Soviet Union to begin talks on reducing the missiles, most of which are in West Germany. But Thatcher, supported by Washington, has said they should not be removed while the Warsaw Pact has superiority in conventional forces and chemical weapons.Thatcher and Chancellor Helmut Kohl are to meet Sunday in West Germany, but neither leader is expected to budge.

"It's a very serious problem for NATO," said Hans Binnendijk, deputy director of the London-based International Institute of Strategic Studies.

In Bonn, Alfred Dregger, the parliamentary leader of the West German ruling coalition parties, said: "At present, there is less danger of Soviet aggression than a situation in which disagreements within the alliance could eventually lead to a loss of the trust that is essential for its existence."

The major beneficiary might be Soviet President Mikhail S. Gorbachev, observers say.

Thatcher has said Kohl's call for weapons talks is principally an election ploy. West German polls show a majority support getting rid of short-range missiles.

"Kohl has a very difficult political situation, and that is creating the problem," said a Thatcher aide who spoke on condition of anonymity. "We're not insensitive to this. But getting rid of short-range nuclear missiles is exactly what the Russians want."

Some observers say the confrontation marks the first time West Germany has asserted its nationhood since the end of World War II. The country is the base for 320,000 American and 60,000 British troops.

"Kohl has publicly asserted . . . that German national interests must take precedence over those of the United States and Britain," the respected Guardian newspaper said in an editorial.

West European leaders are working to defuse the crisis. Italian and Dutch leaders are to meet with West German officials after separate talks with Thatcher, and West German authorities are going to France.

West Germany says it has outright support from nearly half the North Atlantic Treaty Organization countries: Denmark, Belgium, Norway, Italy, Greece and Spain. Britain's leader has Washington behind her.

Thatcher will have a chance to sway West European opinion in a May 29-30 NATO summit, the first gathering of alliance leaders attended by President Bush. The meeting is not, however, expected to generate a unified West European position on the issue, and many say NATO will avoid action until after the 1990 West German elections.

"It's a crisis for NATO," said Mark Fielder, an analyst at the Royal United Services Institute, a London research center on international relations.