Israeli political leaders rallied behind Prime Minister Menachem Begin's Camp David peace commitments last night, appearing to assure solid parliamentary approval of Egyptian President Anwar Sadat's insistence that Jewish settlements in the Sinai Desert be evacuated in exchange for peace.

While there were clear signs that agonizing debate lies ahead in the parliament, Begin seemed to have coopted large segments of the left and centre factions of the parliament, leaving - incongrously - much of the opposition in the conservative wing of Begin's Likud coalition.

Begin said he would not attempt to influence the Knesset members, saying he will leave the decision to their "individual consciences." But in remarks broadcast from Washington on Israeli television, the prime minister left little doubt where he stood on the issue.

"I know I will have to face a discussion with my friends and colleagues. C'est la vie. You must make a decision . . . I'm convinced in my heart that the way we followed is the right way," Begin said.

Israelis were ecstatic about the prospect of peace with at least part of the Arab world for the first time in the country's 30-year history, and seemed almost unable to grasp the enormity of the implications of the summit accord - normal relations with Egypt, travel across borders, exchanges of diplomats and even a pooling of human and technological resources between Jews and Arabs in joint economic enterprises.

Civil servants uncorked wine and champagne bottles and offered toasts in governments offices, talking excitedly about making a seven-hour drive from Jersualem to Cairo, or visiting the 2,000-year-old Petra ruins in Jordan.

As if shrugging aside their memory of the letdown following Sadat's historic visit to Jerusalem last November, Israelis joked about who would be sent to Egypt as ambassador, and whether an Egyptian ambassador to Israel would prefer to live in Tel Aviv or Jerusalem.

Occasionally, officials would drift away from the almost giddy celebrations, and somberly reflect on the meaning of the news from Washington.

Zeev Heffetz, director of the government's information office, shook his head in bewilderment and recalled that when he was awakened before dawn with word of the summit results, his young daughter sleepily wondered what was wrong. "The last time that happened in my house, I was going off to war," he said.

For the most part, however, Israelis just celebrated.

Hebrew newspapers carried banner headlines, proclaiming "Agreement With Egypt." Excited Israelis crowded sidewalk cafes, listening to reports on transistor radios and clerks in stores beamed happily as they talked of peace.

When a woman in a downtown bakery complained that the store was out of sesame rolls, the ebulient clerk told her: "So why do you need sesame rolls? We have peace."

Initial reaction among West Bank officials and Arab residents was mixed, ranging from outright rejection from Palestine Liberation Organization sympathizers to cautious acceptance by people who have shown empathy with Israel in the long peace process.

Elias Friez, mayor of Bethlehem, said, "No Arab can belittle the results of the agreement . . . It is a great jump forward. Once relations between Egypt and Israel are normalized, it may lead eventually to normalization of relations on all fronts with Israel, including the West Bank and Gaza Strip."

In contrast, Bassam Shaqa, militant mayor of the West Bank town of Nablus, rejected the agreement, saying, "What has happened is that Sadat has moved away from the Palestinian and Ara peoples. The agreement will not bring peace to the Middle East. It will intensify the conflict."

A Palestinian Arab near Ramallah said, "It's useless for the Palestinian people. But for the Egyptian people, ood. They are fed up. Life there is terrible."

Israeli government officials said they expect an increase in terrorist activity as the parliamentary debate approaches. During the summit talks, bombs were discovered daily in Jerusalem. A number of them detonated, resulting in injuries and one death.

Security forces were expected to intensify their checks in Arab neighborhoods in Jerusalem, and increase the checkpoints on West Bank roads leading to the city.

In an attack following the accord, Palestinian terrorists yesterday hurled a hand grenade at a busload of Israeli soldiers in El Bireh, on the West Bank north of Jerusalem. The grenade bounced off the bus and exploded on the ground without injuries, authorities said.

The political reaction of Israelis in the street showed surprising unanimity. The Hebrew news-paper Haaretz sent reporters to Tel Aviv's central market, where they found only two skeptics among 50 shoppers interviewed.

Begin received an unmistakable expression of support from opposition Labor Party leader Shimon Peres, who said he believes his party will offer a united stand when the settlement issue is put to a vote, perhaps as early as next week.

In an interview shortly after the Washington announcement, Peres said removal of settlements was a "high price" to pay for peace with Egypt. By late afternoon, however, he was saying that the alternative to an agreement is disorder in the Middle East, and that the Labor Party, while "opposed to the government, is not opposed to peace."

Deputy Prime Minister Yigael Yadin, leader of one faction of the now-split Democratic Movement for Change, also hailed the accords as a "cardinal achievement" and hinted his approval when the measure comes to a vote.

"My tendency at the moment, without having seen the details of the documents, is that if, voting in favor of that issue, we are going to have peace, at the moment I would" vote affirmatively, Yadin said.

Amnon Rubinstein, a leader of the splinter Shai faction of the Democratic Movement, said it will support the government. The five members of the Agudat Yisrael Party and two Liberal Party members reportedly have decided to support Begin.

Coupled with at least a share of the 12 votes in the divided National Religious Party and possibly 15 of the 20 votes in Begin's own Herut Party, the left and centrist support would give the settlement issue the majority needed for adoption, according to most reliable headcounts.

A straw poll of Knesset members last night by reporters for Israel's state-run television showed that of the 68 contacted, 42 favored giving up the settlements, two were against and 24 would not reply.

News of the Camp David agreements hit Israel like a shockwave in the early morning hours, and throughout the day political parties and factions within parties began holding meetings in attempt to draft positions before parliament is called back into session.

Former Labor Party prime minister Yitzak Rabin offered some reservations about the pacts while saying that they represent a step in a "real push for peace."

"There is no doubt the government of Israel has given in on many issues which in the past would have been inconceivable, Rabin said. He said some Knesset members would be put in the awkward position of "having to decide between peace or settlements."

There are about 10,000 Israeli settlers on land occupied during the 1967 war.

An informed Begin aide noted that the prime minister by putting only the settlements issue before parliament, was avoiding lengthy devisive debate on his entire peace policy, and on such thorny issues as Israeli withdrawal from strategic airfields in the Sinai, even though Begin said the United Stated has promised to build new airfields in the Israeli Negev desert close to Sinai.

"If they want to defeat the agreement, they have to do it by defeating the [settlements] clause. Since this is a necessary condition for peace, it will become an up or down vote for peace," the aide said.

One of the most vocal conservative opponents of the plan was Shmuel Katz, Begin's former information adviser, who said giving up the airfields means "giving up minimum security requirements in the south."

He warned of the "growing military might" of Saudi Arabia and predicted war would come "within five years."

Agriculture Minister Ariel Sharon, a devoted supporter of mass Jewish settlements in the West Bank, and one of the Cabinet's most conservative members, said however, that the agreement was "a tremendous step toward peace."

In Tel Aviv, the stock market climbed sharply - 6 percent for industrial stocks.

The Peace Now Movement, which for months has bitterly criticized Begin as an obstacle to peace, joined the Tel Aviv municipal government in arranging a celebration rally at City Hall Square. The peace group congratulated Begin in a statement and assured that "most of the public will stand behind him in the long road to peace."

Abbie Nathan, an unorthodox peace activist who has been beaming his "voice of peace" antigovernment rhetoric from an transmitter aboard a boat off Tel Aviv, announced he will move his operation further north and broadcast appeals to the Syrians to join the peace effort.

Early in the day, the joyous relief also seemed to affect some of the negotiators at Camp David. Defense Minister Ezer Weizman, in a telephone interview with Radio Israel, blurted, "It's probably the greatest event since the creation of the state." As an afterthought, he said, "or since the Six-Day War."

In editorials, Israeli newspapers were lavish with their praise for Begin, Maariv, the conservative afternoon daily, said "This is a great hour for all three leaders who conferred at Camp David, but mainly for Prime Minister Begin, who had to sacrifice more for peace than his two colleagues."

Finance Minister Simcha Erlich, describing the agreement as "revolutionary," said, "We already have some ideas about economic cooperation between Israel and Egypt." He talked excitedly about channelling water from the Nile River to the Negev Desert and sharing agricultural technology with Egypt.

Israeli President Yitzak Navon said, "I hope it will open a new era in the lives of people of the Middle East. We have rivers of blood dividing Israel from its neighbors and its high time for peace to come to this region."

The teachers' union, at the urging of Finance Minister Ehrlich, agreed to end a week-long strike and return to work today as a gesture of national unity. Ehrlich's message to the teachers: If a way could be found to end the impasse at Camp David, a way could be found to reach agreement on teachers' wages.

At the Foreign Ministry's daily briefing for foreign correspondents - normally a relatively lifeless event - reporters who covered the euphoria and depression that marked the last Sadat-Begin talks broke open a bottle of champagne and offered toasts to Israelis.

A woman shopper in downtown Jerusalem said, "Its great. We are very happy and we hope it will bring peace not only with Egypt but the whole world."

There were a few doubters, however. An Israeli worker scowled and said in balting English, "We give too much and get back nothing but the word - its like a Munich agreement."

But most people, almost disbelieving at the sudden turnabout from the gloomy forecasts issued in the summit's last days took an upbeat response.

"I hope to God that everything works out. This is wonderful," said an elderly man in Zion Square. "We are all very happy."