Assemblages comparable to this are virtually unknown in the Andes, he said, since geological upthrusting generally destroys fossil beds. 'Remarkably Intact' Fossils

Nearly all of the fossils were embedded in surface rock and easy to pick up, he said. ''That was another great piece of luck, since we couldn't have brought in excavating equipment on horseback,'' he said. ''Best of all, despite weathering, many of the smallest fossils were remarkably intact and will be relatively easy to study.''

The collection represents both sea and land animals, and through the 1,000-foot thickness of the main butte the group explored, the transition from oceanic to terrestrial environments was preserved in a smooth gradient.

''For example,'' Dr. Novacek said, ''we found the oyster beds and sand dollars just beneath the lowest sediments containing land animals. At that point the water was shallow and receding rapidly - a time of transition from sea to land, as the land was thrust up by magma and the movement of tectonic plates.'' In more recent sediments, the group found species related to modern rodents, porcupines, rhinoceroses and camels. Among the many fossil curiosities they came across were ungulates (including a rabbit-like ungulate), marsupials and giant sloths. Clues on Joining of Continents

These animals, Dr. Flynn said, lived 12 million years before South and North America were linked by a land bridge, and therefore represent groups that evolved differently from their relatives in North America. By precise dating of the sediments in which their bones were found, he said, geologists will greatly improve knowledge of when and under what circumstances land bridges existed.

There is evidence, he said, that a shallow body of water may have once completely severed southern South America from the rest of the continent. A long bay that once stretched from the Atlantic coast of South America to a point near the plateau that the expedition studied may have been a remnant of such a transcontinental channel.

''Among the best indicators of geologic change,'' Dr. Novacek said, ''are rodents and other small animals. They ranged over much smaller distances than large animals, and changes in their populations often reflect local geological changes.''