Egypt and Libya have agreed to "a top-level political meeting" to resolve differences that led to six days of border welfare last week, the Palestinian news agency WAEA reported in Damascus last night.

The agency said the agreement was announced by Yasser Arafat, head of the Palestine Liberation Organization, who has been meeting with leaders of both countries in an effort to end the conflict.

It quoted Arafat as saying the meeting will be in either Kuwait or Algiers as soon as Egypt and Libya end their propaganda war. The report did not say whether Egyptian President Anwar Sadat or Libyan leader Muammar Qaddafi would attend.

Arafat arrived in Syria after meeting with Sadat to deliver Libya's answer to the Egyptian conditions for ending the border crisis.

The pro-Libyan newspaper, As Safir in Beirut reported that Qaddafi had rejected the Egyptian terms, but there was no official confirmation and the cease-fire ordered by Sadat Sunday apparently was holding.

Palestinian sources in Cairo said a principal Egyptian demand was that Libya remove or deactivate border electronic systems that it uses for surveillance of Egyptian territory.

Egypt also reportedly has demanded that Libya dismantle training camps that Egypt says have been used to promote subversive activity in Egypt, and that it stop supporting opposition political groups - including religious extremists who have used terrorism as a tactic - inside Egypt.

Additional conditions were said to be promises from Libya not to attack Egyptian border positions, to end anti-Egyptian propaganda and to agree to the establishment of joint Egyptian-Libyan border commissions headed by Palestinians.

The fighting last week was one of the most serious crises in the uneasy relationship that has existed between Egypt and Libya since the 1973 Arab-Israeli war.

Sadat said that it was precipitated by Libyan attacks on Egyptian positions, and that he sent troops and planes into Libya to teach Qaddafi "a lesson he will never forget."

The Arab Revolution News Agency in Tripoli said yesterday that Libyans are prepared to defend their country against any fresh aggression by Egypt and quoted an authoritative Libyan source as saying both men and women are armed and ready to fight.

Arab diplomatic sources in Beirut said that a number of Palestinian fighters had left Lebanon to join Libyan troops at the Egyptian border but probably had arrived too late for the fighting.

Libyan Foreign Minister Abdel Salam Tureiki began talks with French government officials in Parris on issues that included the warfare with Egypt. Libyan officials said Arab workers in France have called at the Libyan embassy to volunteer to fight, but a Libyan spokesman said the embassy is not taking enlistments.

These other developments were reported in the Middle East:

Bombs exploded in an outdoor market in Tel Aviv and under a car in Jerusalem, injuring 13 people. Police said an Arab youth was arrested for the Tel Aviv bombing, which accounted for 11 of the injured.

Palestinian guerrillas and rightist Christian forces traded artillery fire in southern Lebanon, ending a four-day old cease-fire. Travelers from the area said five persons had been killed.