Canada's ruling Liberal Party suffered a stinging setback in Monday's federal byelections that could forshadow a serious decline in the political fortunes of Prime Minister Pierre Trudeau.

With 15 of the 264 parliamentary seats at stake, the Liberals won in only two contests losing five seats to the opposition Conservative Party in vital Ontario Province.

The Conservatives elected 10 candidates and their leader, Joe Clark, predicted his party would win in the next national elections which must be held by next spring.

While the Liberals retained a sevenseat majority in the House of Commons, the outcome of Monday's by elections raised serious questions about their ability to retain power beyond next spring.

They suffered a major blow in Ontario, the most populous province which provides 95 of the 264 members of Parliament.The conservatives polled about 50 per cent of the vote there, the small New Democratic Party was second with 25 percent, while the Liberals were third with 20 percent.

The prevailing view among political observers in Canada is that "if the Liberals cannot carry Ontario they cannot carry the country." Apart from Canada's sagging economy. Trudeau's personal leadership and the Quebec separatist movement were the key issues in the campaign.

There was immediate speculation in Ottawa, Toronto and elsewhere in Canada that the Liberals may replace Trudeau, 58, with a new party leader before the next general election. The man most frequently mentioned is John Turner, 48, the former finance minister, who quit politics two years ago after a falling out with Trudeau over economic policies.

The Conservatives new economic proposals are generally credited for the party's greater ability to attract middle-class support. Among other things, the Conservatives are proposing tax reductions in the form of deductions for mortgage interest payments and for property taxes. Such deductions have long been in existence in the United States.

Among those who were defeated in Monday's byelections were two former Cabinet members, Mitchell Sharp in Toronto and Bryce Mackasey in Ottawa. Both districts were regarded as solidly Liberal.

Trudeau conceded that Monday's outcome, especiallyy the setback in Ontario, was an expression of feeling against the long Liberal control of the government. The Liberals have been in power since 1963, and Trudeau has been in charge since 1968.

But Trudeau dismissed reports about pressure for his resignation, saying, "I'm not going to be crushed by a few byelections." Other Liberal spokesmen said privately, however, that the party would have to reappriase its policies before the next general elections.

Most damaging for the Liberals was their failure to win a single seat outside their traditional stronghold in French-speaking Quebec.

In the 15 byelections contested in Seven provinces, the Conservatives averaged nearly 49 per cent of the popular vote, or nine points more than in the last general elections in 1974. The Liberal dropped from 41.3 to 30.5 percent.

William Rowe, Liberal leader in Newfoundland, yesterday called on the party's rank-and-file to disccuss Trudeau's role as party leader. "The ship is more important than any member of the crew even if that crew member is the captain," Rowe said.