A Pentagon employe identified by the FBI as responsible for setting a four fires at the Pentagon, including two yesterday morning, was released in the custody of his parents yesterday after federal prosecutors declined to prosecute him.

An FBI spokesman said last night that the U.S. Attorney's office in Alexandria declined to prosecute the employe after determining that he has "a serious mental incapacity." The spokesman said the man, whom he declined to identify, was not arrested.

The FBI spokesman said the man is believed responsible for $16,000 in damages caused by the fires, the most serious of which was in the meditation room on the third floor of the Pentagon Friday.

No one has been injured in the fires, which broke out on different floors. None of the fires involved classified records, a Defense Department spokesman said.

Employes extinguished the fires that broke out yesterday shortly after 10 a.m. before the Arlington Fire Department arrived, according to a spokesman for the General Services Administration, the government's landlord.

The first fire occurred in a janitor's sink in a small closet on the fifth floor between the seventh and eighth corridors, said the spokesman. Employes found rags, papers and a cardboard box stuffed into the sink. The second fire was reported a few minutes later in a corner of an equipment repair shop in the ninth corridor of the basement, where rags and strips of cloth were found.

About the same time the fire in the meditation room broke out Friday, another was reported in a forklift in a first-floor storage room. Officials do not know how those fires were started.