Five months of intensified Israeli air strikes against Palestinian guerrillas and relentless artillery pounding by Israel and its Lebanese Christian allies have devasted southern Lebanon, turning the rocky border hills into a virtual free-fire zone.

The concentrated attacks with 155mm and 175mm artillery, rockets and U.S. supplied jet fighters have taken a high toll in civilian Lebanese and Palestinian casualties. They have emptied many Lebanese towns, villages and farmland across a 15-mile-deep swath of Lebanese territory stretching along the border from the Mediterranean coast to the foothills of Mount Hermon.

The flight of the civilian population, combined with the "Free Lebanon" enclave set up by Israel's Lebanese Christian followers, have in effect gained for the Israeli armed forces almost the same advantages as they were forced to give up in withdrawing from southern Lebanon three months after their March 1978 invasion.

Despite the presence of United Nations peacekeepers, the border hills have been turned into the main battleground for the struggle between Isareli armed forces and Palestinian guerrillas, moving the principal line of conflict northward into Lebanon instead of along the Israeli border and reducing opportunities for Palestinian commandos to slip into Israeli settlements or shell them from nearby vantage points.

The Lebanese government estimates 175,000 Lebanese civilians have fled the furty of the border area bombardments since Israel launched its policy of preemptive attacks against the Palestinians in April. In addition, the Palestine Liberation Organization says that more than 50,000 Palestinian civilians have fled the shelling and bombing of their refugee camps around the hard-hit city of Tyre, 15 miles north of the border.

The Palestinians are filling Sidon, 35 miles north of the frontier, and Beirut the capital, with squatter families lies camping out in empty apartments, unfinished buildings and warehouses or simply under a tarp stretched between a tree and the family pickup truck loaded with salvaged household goods.

This exodus adds to the dislocation caused by an estimated 300,000 Lebanese who were already displaced by fighting during the 1975-76 civil war. Against the backdrop of 300,000 Palestinians already taking refugee in Lebanon has at some point in the last several years been a refugee.

Lebanese and Palestinian officials and Western diplomats in Beirut are concerned by the intensity of shelling since April and the civilian casualties and destruction of civilian buildings it has caused. Their concern is increased by what they see as insensitivity in the United States and other Western nations to the damage being done by the artillery battles that because of their repetitive regularity, have lost most of the world's attention.

"Since the Israelis started their policy of preemptive strikes, there has been a human problem of dimensions that are just not commonly realized," said a diplomat who follows the situation.

An official Lebanese study, prepared for relay to the U.S. State Department in connection with Lebanese demands that Washington pressure Israel to halt the shelling, found 96 Lebanses civilians, including 21 women and 30 children, have been killed since April 1 in shelling and air raids.

The study found 224 Lebanese civilians were wounded during the same April to Aug. 24 period, including 49 women and 34 children.

It did not include guerrilla casualties or Palestinian civilians killed in attacks on refugee camps. The PLO has reported several dozen killed during that time. Since they study was completed, a dozen Palestinian civilians were reported killed over the weekend during heavy shelling of the Ein Helweh camp on the outskirts of Sidon.

At the same time, the shelling has damaged villages inhabited by Lebanese farmers. Many have fled, leaving their tobacco fields untended just as harverst time approaches. Some orange and lemon groves also are going without care because their owners have fled north.

Here in Tyre, the central commercial area is deserted and heavily damaged. The main Manshiyeh Street and central Manshiyeh Square have been a scene of rubble and desolation since a fierce artillery barrage Friday sent 155mm and 175mm shells crashing into homes and shops.

One landed squarely on Mahmoud Qadodo's clothing store. Dresses, shirts and jackets hang like rags from the twisted steel and chunks of concrete that are all that is left of his shop.

Qadodo has fled, along with most of Tyre's approximately 90,000 residents.

Many area residents are expected to return if a three-day old lull holds. They will flee again if the shelling resumes, as they have several times in recent months.

In the meantime, commercial activity has halted throughout Tyre, formerly a busy fishing port and regional market town. Only two stores remain open in the central city, Mohammed Abed's bakery and the Haddad grocery store. The open-air market is closed.

"There are no people," said the baker's wife, Amera Abded. "No one comes."

Antoine Basha, 39, a Christian shop owner, has pulled down his steel shutters for the indefinite future and is sending what is left of his stocks to Beirut to help feed his family, who fled more than three months ago to live with Antoine's brother in the capital.

His shop, at least, is still standing. The nearby home of Tanios Khairallah, 53, was reduced to rubble by the shells that crashed down on it early Friday morning.

Khairallah and his wife, who were awakened by approaching booms, already had taken shelter in the nextdoor residence of Bishop haddad and they were uninjured. But as the balding fisherman stood beside the ruins of his home Tuesday -- he was still stunned by what had happened -- another shell came down on his 20-foot fishing boat and sank it in the tiny Tyre harbor not far from the statue to which Christian fishermen pray as they go out to sea.

"They say we are terrorists here," he said. "Where are the terrorists? I am Lebanese, not a terrorist."

Just then another fisherman, Piskallah Ghafari, 38 came back to the neighborhood for the first time since he fled last week. He found a shell had wrecked his second-floor apartment, spewing debris over the three beds where he, his wife and the younger of their two children slept.

"Look at my house," he said. "How can anyone live there now?

He scooped up two pillows and two sheets and headed for his fishing boat, on his way by sea to Sidon. He left the door to his apartment open, saying, "What can I do? If anybody wants anything, they can have it."

Lebanese like Ghafari and his family have become the victims of their surroundings, which include a substantial Palestinian guerrilla presence in and around Tyre and throughout the hills that overlook it.

Despite PLO pledges to move commandos away from civilian population centers, guerrillas are visilbe in Tyre and PLO officers appear to be in charge of the city, working through sympathetic local civilian authorities.

Intelligence sources in Beirut estimate about one-third of the PLO'S approximately 23,000 armed guerrillas are stationed south of the Litani River in the southern Levanon battle zone where they draw the Israeli and rightist Christian shellfire.

The Christian enclave of Maj. Saad Haddad, about five miles deep by 29 miles long, is the main target of guerrilla artillery fire. Some Palestinian artillery can fire over the enclave directly into Israel, however, and the guerrillas' Soviet-supplied Katyusha rockets have the range to reach northern Israeli settlements. For PLO officers, the distinction is not worth marking. In any case, they consider Haddad just a convenient tool for Israeli military commanders.

Haddad's 1,200 troops are trained equipped and supplied by Israel. When he announced his "Free Lebanon" last spring, Haddad spoke to reporters in Metullah, Israel. During negotiations for cease-fire last weekend, his messages to the United Nations also came from that northern Israeli town.

Reliable sources say Israeli artillery batteries regularly are deployed in side the enclave on Lebanese soil and that Israeli officers often command Haddad's artillery batteries, which are supplied by the Israeli Army and for which Israeli jets fly regular reconnaissance missions.

For Western diplomats in Beirut however, Israel's use of Haddad as a surrogate in southern Lebanon is no longer the main concern. What worries them since the intense shelling began last April is what they call "lack of proportionality."

U.N. observer records show that shelling from Israel or the Israeli controlled Haddad forces has occurred in southern Lebanon on an average of four or five days a week since April 1. Most of those days, the diplomats and international observers say, the fire from Israeli or Haddad's Israeli controlled batteries far surpassed the first from Palestinian guns.

"It's not that the Palestinians wouldn't like to do more," said an international observer. "It's just that they can't. They don't have the means. There is such a disparity in the means."

In addition, they say, Israel has launched air raids on 15 days against Palestinian targets since April 1, some of which caused heavy civilian casualties.

"It is not a tooth for a tooth; it's one tooth and you get 100 teeth," a diplomat said. "one eye and you get 100 eyes. That's the immorality of the thing."