Presidential Airways, a low-fare, full-service airline, announced yesterday it has agreed to purchase Key Airlines Inc., a small charter airline flying to the Caribbean, Mexico and the United States, for $16 million.

The purchase, the first by the fledgling carrier based in Reston, will be financed privately under unspecified terms, said Geoffrey Crowley, Presidential's senior vice president of marketing.

Key Airlines, based in Las Vegas, operates charter flights for military and civilian customers. A privately held firm, Key is expected to generate about $40 million in revenue for 1986 and has been profitable, said John Backus, Key's vice president for marketing and sales.

Officials of both airlines said the acquisition should improve profitability. "The acquisition of Key Airlines will allow Presidential Airways to achieve significant operating efficiencies while adding to our airline's revenue base through expansion of our existing contract flight operations," said Harold J. Pareti, president of Presidential.

The purchase "mellows the peaks and valleys a little bit" in the competitive airline industry by broadening Presidential's base of operations, Crowley said.

"Our main business is on the weekend. Those days we fly 10 to 14 hours a day, and we're underused Monday through Friday," Backus said. "Presidential caters to business flyers, so their peak time is during the week. We are maximizing our revenue-generating potential."

The purchase, subject to Department of Transportation approval, is the outcome of a joint marketing and operations agreement in effect since shortly after Presidential's founding in October 1985. Presidential occasionally operates charters arranged by Key.

After the acquisition, Key will continue charter operations with Presidential's Boeing 737s; Presidential will gain use of Key's fleet of eight Boeing 727s.

The routes of Presidential and Key overlap in at least six cities, Backus said. A combined fleet will produce immediate savings for the airlines on fuel, ground handling costs and insurance, he added.

Key will operate as a wholly owned subsidiary and continue to use Las gas as its base, Crowley said.

Presidential had first-quarter revenue of $11.8 million and a loss of $5.5 million.