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Setting the stage for a potentially momentous shift in church-state law, the Supreme Court agreed Friday to decide whether public school teachers may offer remedial help at parochial schools.

The court said it will consider reversing its 12-year-old decision barring public school teachers from church-affiliated schools.Although the court's ruling likely will focus only on the issue at hand, its rationale could have an impact on other church-state disputes, such as prayers in public schools and tax breaks for parents who send their children to church-run schools.

Today's court, far less demanding than it once was in requiring a strict separation of church and state, said it will study appeals by New York City school officials and parents of parochial school students.

The Clinton administration supported the appeals in a friend-of-the-court brief that said the 1985 Supreme Court ruling was wrong and resulted in "hundreds of millions of dollars" of needless administrative costs.

Arguments will be heard in April, and a decision is expected by July.

Word of the court's action drew quick condemnation from Americans United for Separation of Church and State.

"It would be wrong for the court to approve using public funds in religious schools for any purpose," said the group's executive director, Barry Lynn. "This could open the floodgates and divert millions of public dollars to private religious schools wholly unaccountable to the taxpayer."

But Mark Chopko, general counsel of the U.S. Catholic Conference, said the court should aban-don its 1985 ruling. "I hope that this action signals the court's willingness to do justice to the children most in need of education," he said.

By a 5-4 vote in 1985, the nation's highest court ordered New York to stop sending public school teachers into parochial schools to teach such subjects as remedial reading and math.

"The symbolic union of church and state inherent in the provision of secular, state-provided instruction in the religious school buildings threatens to convey a message of state support for religion to students and the general public," the court ruled back then.

On the current court, only Justice John Paul Stevens voted with the majority in the 1985 decision in Aguilar vs. Felton.

In recent years, Chief Justice William H. Rehnquist and Justice Sandra Day O'Connor - two dissenters from the 1985 ruling - have been joined by Justices Antonin Scalia, Anthony M. Kennedy and Clarence Thomas in calling for reversal or at least reconsideration.

Noting comments by those five justices, the appeals acted on today said it was "apparent . . . the result in Aguilar no longer may command the support of a majority of this court."

"The underpinnings of Aguilar have been eroded by subsequent decisions," the appeals added.

The 1985 ruling did not ban public school teachers from helping parochial students. In fact, such help for low-achieving students from poor families is required by a 1965 federal law known as Title I. But the ruling barred public school teachers from teaching at religiously affiliated schools.

Acting Solicitor General Walter Dellinger, in a brief filed in behalf of the Clinton administration, said "hundreds of millions of dollars . . . have been spent on administrative costs made necessary only because of the need to comply" with the 1985 ruling.