Bicycle Mechanics - French bike, need I say more?

I bought a 1970's Peugeot frame and fork for $10.

Problem: Bike needs a head set. The fork is threaded and there is a notch/slot in the back of the fork, which to me would indicate that it is standard 24 threads/inch right? The threads are not filed (french threading) so as far as I know it is standard. Also, I took my 22.2mm stem from another bike and shoved it down the fork to see if the headset should be 1" or 1 1/8". The stem fit but BARELY, it was a really tight squeeze.

What size headset do I need?

Edit:
In looking at the decals and serial # I think the bike is between 1970 and 1974.

I'm not a Peugot expert, but I'd say if the stem fit, it's not a French fork. Plus, as you correctly mentioned, the groove for the spacer nub is another indication. Barely is how it's supposed to fit. Did you grease it? Best guess is ISO (http://sheldonbrown.com/harris/headsets/headsets-1-inch-threaded-iso.html).

thanks, I'm thinking ISO. The place where I bought the frame will sell me a 1" threaded headset for $10 so I am going to stop over there this afternoon and have that done. : )

If it's an early seventies Peugeot, the fork should be French unless it has been replaced. There are exceptions, though. My '74 PA10 has a fork with BSC threads, but only a 22mm French fork will fit. Look for a Stronglight A-9 needle bearing headset.

http://inlinethumb58.webshots.com/41465/2240769840068014369S500x500Q85.jpg (http://rides.webshots.com/photo/2240769840068014369croCQJ)

Thanks Mucho!

I purchased a french threaded headset, and had it installed. I also had a square tapered spindle installed into the french bottom bracket in order use cotterless cranks. Parts and install cost me $40. That puts me at $50 for the entire bike.

Now for wheels, cranks, 22mm stem, and chain. : )

i am also having some trouble identifying the bike.

I know it is a 1972.
There are no holes for water bottle cages.
The paint scheme is IDENTICAL to the photo posted above (two front brazings painted black, fork is half chrome)
There is a decal that states "Tube Special Allege Peugeot"
Originally there were cable three cable guides on the top, and two hooks for what would have been an air pump (i removed them)
Also the nub for the gears is on the right side of the down tube.
Two eyelets on the fork.

If it has a half chrome fork, black lugs, Peugeot tubing and a cottered crank, it has to be a PA10.

It's a fairly rare model in the U.S. People who knew enough to want fancy lugs and forged dropouts usually knew enough to want Reynolds 531 tubing, so they spent a few more dollars and got the PR10.

http://home.wanadoo.nl/peugeotshow/images/1972_2.jpg

If it has a half chrome fork, black lugs, Peugeot tubing and a cottered crank, it has to be a PA10.

It's a fairly rare model in the U.S. People who knew enough to want fancy lugs and forged dropouts usually knew enough to want Reynolds 531 tubing, so they spent a few more dollars and got the PR10.

http://home.wanadoo.nl/peugeotshow/images/1972_2.jpg

Yep. You described it exactly. It has Peugeot tubing, not the Reynolds. Sounds good. : ) I can't wait to ride it once I get myself a set of wheels. : )