Immigration reform bill still hangs on.

So bleak has been the outlook for immigration reform that the words ''unlikely to pass this year'' have almost become welded to the official title of the Simpson-Mazzoli Bill.

With only two weeks left in the congressional schedule, the overhaul of United States immigration laws is caught in election-year tensions. Sen. Alan K. Simpson (R) of Wyoming says he and the bill's cosponsor, Rep. Romano D. Mazzoli (D) of Kentucky, have found the issue ''filled with guilt, fear, emotion, and racism.''

The White House is skeptical about expenses, and the Democratic presidential nominee opposes it. So does an unlikely alliance of groups ranging from Hispanic and civil liberties organizations to the US Chamber of Commerce.

But while leaders on Capitol Hill periodically pronounce the legislation to be dead, the bill aimed at gaining control of the national borders refuses to die. A conference of senators and House members is hammering out a compromise version.

News of the bill's death has been ''greatly exaggerated,'' said Senator Simpson, citing the words of Mark Twain when he read of his own supposed decease.

Although the first major reform of American immigration laws in 30 years faces formidable obstacles, supporters are planning to complete the compromise version by midweek. The House and Senate conferees have already agreed on a key provision of the reform, sanctions - including criminal penalties for employers who knowingly hire illegal aliens.

Employer sanctions, long the most emotional of the immigration issues, touched off a new round of fireworks on the opening day of the House-Senate conference last week. ''There is no question that anyone who looks or sounds like me is going to be questioned anytime I look for a job,'' said Rep. ''Kika'' de la Garza (D) of Texas, who speaks with a pronounced Spanish accent.

Sen. Edward M. Kennedy (D) of Massachusetts said sanctions will lead the employer to say, ''I'm closing the door to foreign-looking people who may put me at risk.''

The foes, however, could not erase the employer sanctions, which have been approved by both houses. ''There is a worse risk'' for Hispanics, Simpson said, ''and that is to do nothing.'' He warned that the result would be a backlash against the flow of illegal aliens, which is now estimated to be at least 1 million a year.

The Senate-House conferees have hit snags, especially over protection against job bias. But even the bill's chief opponent, Rep. Edward R. Roybal (D), concedes he will have trouble stopping the reform compromise.

''I can't stop it in conference,'' he said in an interview as the House-Senate panel began its work last week. The Californian, who is the dean of Hispanic members of Congress, said that he still hoped to defeat the measure on the floor of the House, where it squeaked through with only a five-vote margin earlier this year.

Since then, Hispanics have mounted an intense campaign against the reform, even though it offers amnesty to some Hispanics now living in the US illegally.

Meanwhile, some conservatives have fought the bill because they dislike any amnesty for illegal aliens.

Despite the array of opponents, House Speaker Thomas P. O'Neill Jr. (D) of Massachusetts has promised to take the bill to the House floor if the conference chairman, Rep. Peter W. Rodino Jr. (D) of New Jersey, makes that request. The speaker downplays the political dangers in the bill. ''I suppose it's a side issue somewhere along the line,'' he said last week. ''I don't see it's any earth-shaking development,'' whether the bill passes or not. He added that he had not spoken recently to Democratic presidential nominee Walter F. Mondale about the bill, which Mr. Mondale has vowed to fight. The speaker said the two have an understanding that ''he and I would not talk about legislation'' until the end of the congressional session Oct. 5.

The biggest hurdle for the bill now could be time. The conference still must work out an agreement on protections against job bias and on a cutoff date for alien residents eligible for legalization. The House version would offer amnesty to qualified residents living here since January 1982; the Senate offers it for those here since 1980.

Unless the conference finishes soon, the bill could be declared a goner once again. The legislation faces a threatened filibuster in the Senate, where it has twice passed overwhelmingly, and its supporters would probably need several days to overcome delay tactics.

But even if it misses the deadline, Simpson maintains that the reform still has life. There's always the possibility of a lame-duck session after the elections, he adds.

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