Three white plasterboard doves have appeared on the walls around Egyptian President Anwar Sadat's vacation house in Ismalia.

"That means peace," a smiling guard explained yesterday.

The doves symbolized the hopes of Egyptians and Israelis for the talks Sadat is to hold with Israeli Prime Minister Menahem Begin in Ismailia today.

The Suez Canal city was brightly decorated yesterday with more doves, gaily colored banners and the Egyptian flag. The Israeli flag was not seen, although it was expected to be flown for Begin's arrival.

"We want to give Prime Minister Begin the same welcome that President Sadat received in Jerusalem," said Abdullah Feres, a student, referring to Sadat's visit to Israel last month.

When the Egyptian President arrived in Jerusalem on the first visit by an Arab leader to Israel, crowds lined the streets to greet him as Israeli and Egyptian flags flew side-by-side.

In Tel Aviv, Israeli also expressed hopes and the successful outcome to the Christmas Day meeting, some tempered their optimism with caution.

"I'll believe it when I see it, said a factory guard. "And I won't believe it until I see signatures on a piece of paper."

Everybody wants peace,"said Ruth Ultmann, 28, as she played with her daughter in a Tel Aviv park. "We are a little worried . . . whether Egypt really wants peace."

Noam Neder, 40, a worker in a government office, said Israelis "have paid a very high price in the last 30 years for living in this country. We don't want war and now for the first time we have a chance for setlement.

Neder said he did not vote for Begin's Likud bloc when it won the national election in May. But he said that now "Begin is proving himself to have the attributes of a great leader - he was able to change his ideas."

Begin's trip to Egypt will be a working visit, not an official one that requires much fanfare. It will be the first time an Israeli head of government has gone to Egypt since the founding of the Jewish state 29 years ago.

Begin, accompanied by to Cabinet officers including Foreign Minister Moshe Dayan and Defense Minister Ezer Weizman, is to arrive at mid-morning at Abu Sweir military air-base west of Ismailia. He will be met by Egyptian Premier Mamdouh Salem.

The Israelis will be taken by helicopter to Sadat's three-story tanstucco vacation home.

Begin will walk past the wall with the plasterboard doves and up a pathway lined with potted plants to Sadat's house.

Barbed-wire military checkpoints ring Ismailia. Another set of road-blocks cuts off Sadat's house from the rest of the city.

After their meeting, Begin and Sadat are to appear at a massive news conference inside a drained water tank in the Suez Canal Authority Building.

The authority's research section used the tank to study the movement of currents and waves. It was the largest space available for a press center, so the water was drained and more than 1,500 chairs were set up for reporters.