Egypt's ambassador to Cyprus flew home yesterday four days after his country broke diplomatic relations with the Mediterranean island's government over the bloody Larnaca airport battle Feb. 19 in which 15 Egyptian commandos on a hostage rescue mission were killed.

Ambassador Hassan Shash, his family and three other Egyptian diplomats left on the eve of the court appearance of two Arabs facing murder charges in the slaying in a Nicosia hotel of Yussuf Sebai, editor of Cairo's influential Al Ahram newspaper and friend of Egyptian President Anwar Sadat.

Sebai's killer seized several other Arabs hostage and commandeered an aircraft which flew to the East African country of Djibouti and then returned to Nicosia's Larnaca airport, where the Egyptian commandos came under Cypriot fire as they attempted to storm the plane. Cyprus has refused an Egyptian demand to send the alleged killers to Cairo for trial.

As Shash headed home, his Cypriot counterpart in Cairo, Antis Souterfades, returned to Nicosia with his family and the five other members of his embassy.

The Arabs accused in Sebai's killing have been identified by their passports as Samir Mohammed Katar, 28, a Jordanian, and Zayed Hussein Ahmed Ali, 26, a Kuwaiti. In court today they will have to answer the murder charge, which carries a mandatory death sentence upon conviction.

Egypt, meanwhile, also appears close to a complete break in relations with the Palestine Liberation Organization and its chairman, Yasser Arafat, as a result of the Larnaca shootout.

A leading government official in Cairo said that if Egypt's own investigation proves PLO gunmen took part in gunning down the Egyptian commandos, all ties will be severed with the Palestinian front organization.

It has been alleged in Cairo that someone high in the Cyprus government instigated the Larnaca shootout to prevent the Egyptians from capturing and interrogating Sebai's killers since they might have compromised unnamed Cypriot co-conspirators.

The PLO has denied any involvement in the shootout or in the Sebai killing.