The government today placed under house arrest the Pir of Pagaro, the last prominent opposition figure still at liberty in Pakistan.

The Pir has been spokesman for the nine-party Pakistan National Alliance since the arrest of other leaders during the campaign to oust Prime Minister Zulfiqar Ali Bhutto and overturn the disputed results of a general election last March.

Troops meanwhile moved into the big Punjab city of Multan and imposed a curfew after a gunbattle yesterday between Alliance supporters and security forces. The government said two persons were killed, but other sources put the death toll at nine. The fighting in Multan was the worst in Pakistan since April 22, when at least 40 died on the day that martial law was imposed on the cities of Lahore, Karachi and Hyderabad.

The Pir issued a strong statement last night rejecting a proposal by Bhutto to hold a referendum on his personal leadership as a way out of the country's political crisis.

Bhutto proposed the referendum in a speech to the National Assembly Friday, but gave no details. He did not say what question the voters would be asked to decide, nor did he give a date for the vote. He also failed to say whether opposition leaders would be released from prison, whether martial law would be relaxed, or who would supervise the voting and the vote count.

The Pir, head of the Pakistan Moslem League and leader of the religious Hur sect, declared the opposition agitation would go on until Bhutto resigned and agreed to hold fresh elections.

The Pir, or saint, is venerated by his followers in the province of Sind. They number from 300,000 to a million, and observers believed the government had held off detaining him to avoid sparking a violent reaction by his followers.

The Pir said last night there was no possibility of a free and fair referendum, andthe referendum would in any case avoid the real issue - opposition demands for fresh national elections.

A guard of police and plainclothes security men today surrounded the house in Islamabad where the Pir had been staying during the last three weeks while consultations went on with imprisoned Alliance leaders detained at a camp just outside the federal capital.

In the last two days, the opposition leaders have been split up and moved to different jails around the country, indicating that Bhutto has abandoned hopes of negotiating with them.

When the curfew was relaxed for two hours in Multon today, thousands of Alliance demonstrators poured into the streets chanting anti-Bhutto solgans and denouncing his plan for a referendum.

Estimates of the crowd ranged from 50,000 to more than 100,000 but there was no violence.

Two persons were killed and 15 injured yesterday in fighting between Alliance demonstrators and security forces in the town of Kamoke, between Islamabad and Lahore, the opposition press reported today.

Unofficial counts put the number of lives lost in the agitation at about 300 since the March elections, which Bhutto won in a landslide and the opposition says here rigged.

Political observers said it was too early to judge whether the referendum plan would deflate the opposition agitation, but sources in Bhutto's ruling Pakistan People's Party considered the lull today a hopeful sign.