Aram Khachaturian, 74, the Soviet composer who was widely popular for "Saber Dance" and other works based on the folk music of his native Caucasus, died in Moscow Monday following a long illness, the official Tass news agency reported yesterday.

Khacharturian attained the highest honors of the Soviet state for such compositions as the ballets Gayne" - of which "Saber Dance" is a part - 'Spartakus" and "Masquerade." Tass said Communist Party leaders of the Soviet Union expressed "deep sorrow" at news of his death.

Although he never received the same critical acclaim as his contemporaries, Dmitri Shostakovitch and Sergei Prokoflev, Khachaturian was enormously popular among Russian listeners. He also was popular inthe West, and "Saber Dance once was on the American "Hit Parade."

He travelled widely outside the Soviet Union.In 1968, he made a 10-city tour of the United States and conducted the National Symphony Orchestra here. He also appeared in Italy, Sweden, Britian, Latin American and Japan.

As one of the most prominent Soviet composers of his time, he played a role in the continuing struggle between the Communist Party and artists who wished to express themselves without hindrance. Khachaturian was "liberal' in this battle.

Mstialav Rostropovich, director of the National Symphony, who lost his Soviet citizenship because of his support for dissidents in his country, said in Washington yesterday that Khachaturian was "a very good friend, one of the most honest people - we loved each other.

"Khachaturian wrote for me a cello sonata in the last two years, since I have been away from Russia. He said I have been away from Russia. He said to me, 'You understand that I cannot dedicate it to you now.' But on my copy, in red, he wrote, 'Dedicated to Mistislav Rostropovich.' Now that this can no longer harm him, I can tell it."

Kachaturian was an Armenian born in Tiflis, now Tbilist, the capital of the Soviet Georgian Republic. His father was an artisan. He played in a school orchestra in Tbillsi and began his formal musical education in Moscow in 1921.

"I became a composer by accident," he once said. "Before the age of 19 I did not know a single note."

He remained at the Moscow Conservatory of Music as a student and graduate student until 1937. By then he already had written numerous compositions that bore the hallmarks of his work - strong melodic lines with rich orchestration and rhythms. He became a diplomate of the conservatory for his "First Symphony," finished in 1934.

His other works include. Several "poems" and "Dance Suites," "Poem about Stalin" (1938), "Happiness" (1939), "Second Symphony" (1943), "The National Anthem of the Armnian Soviet Socialist Republic" (1944), "Cello Concerto" (1947), "Ode to Joy" (1956) and "Ballad of the Motherland" (1961).

His awards included four Stalin Prizes and two Orders of Lenin.

This did not spare Khachaturian from the censure of Andrei Zhdanov, Stalin's minister of culture, in 1948.With prokofiev and Shostakovitch, the composer was criricized for "formalism."

"Formalism" was a term used to describe departures from "socialist realism," a form of art that was supposed to appeal to the masses by avolding modernistic trends. In music, this meant avoiding such techniques as the 12-tone scale and dissonance.

Although he had been an official of the Soviet Composers Union since the late 1930s, Khachaturian was forced to apoligize for his alleged deviations.

He was not fully rehabilitated until 1954, a year after Stalin's death, when he was named a "People's ARTIST OF THE U.S.S.R."

In an article published late in 1953 Khachaturian said that "a creative problem cannot be solved by bureaucratic means." He criticized a tendency to write music "without creative elan, with glance over the shoulder expressing the fear that something untoward may happen."

In addition to his ballet suites, orchestral and other works, Khachat urian wrote the musical scores for numerous films. In 1951, he was made a professor of compostion at the Moscow Conservatory.