Iran's Ayatollah Ruhollah Khomeini called on Iraq's Army yesterday to overthrow the "corrupt" government of President Saddam Hussein as realtions between the two powerful Middle East nations appeared to move closer to open warfare.

Hussein, who reportedly ordered the mobilization of several thousand Iraqi troops along the hostile border with Iran, responded with a warning that Iraq was "prepared to enter into any kind of battle" to defend its territory and honor, Iraq's official news agency said.

For the third straight day, Iran's official Pars news agency reported fighting yesterday between "Iraqi aggressors" and Iranian Revolutionary Guards in the border region. No casualties were announced.

Monday Iran put its armed forces on "full alert," saying the move was in response to repeated Iraqi attacks on border outposts and oil facilities.

The fighting followed a renewal of Iraqi claims on disputed border waterways and demands than Iran relinquish three islands it has occupied in the strategic Strait of Hormuz, the mouth of the Persian Gulf. Each country has accused the other of fomenting trouble among its ethnic and religious factions.

Iran accused Iraqi reconnaissance planes of violating its airspace yesterday and it shut the Tehran office of the Iraqi News Agency, ordering the staff to leave. Explusions and withdrawals of diplomats have left the two countries virtually without reresentation in each other's capitals.

Khomeini, in a broadcast speech, attacked Saddam Hussein and Egyptian President Anwar Sadat, who has given refuge to the deposed Shah, urgin "noble Islamic nations" to kill both leaders.

Calling Hussein a "treacherous parasite," Khomeini exhorted Iraq's Army and people to "wake up and topple this corrupt regime in your Islamic country before it is too late."

The last few days of armed and political attacks, in the view of analysts here, have brought relations between the two countries to their most dangerous point since 1974 when U.N. mediation brought an end to heavy fighting.

Since the United States now has no diplomatic relations with either country, however, is has been difficult for analysts here to assess the seriousness or scope of the current fighting.

"One country is secretive and the other is in chaos, so it's hard to tell what's really happening," one U.S. observer said.

Since the overthrow of Shah Mohammad Reza Pahlavi a year ago, mass desertions and purges of military personnel and widespread deterioration of their sophisticated weaponry have left the once-powerful Iranian armed forces vulnerable, according to intelligence estimates here.

"I'd put my bet on the Iraquis now," one U.S. military analyst said. "Iran is totally shattered."

In addition, Iran, under Khomeini, has lost much of the international support that the country enjoyed under the shah.

In 1974, Iraq was aware that, in an all-out war, Iran could call on the United States, Turkey or Pakistan for assistance. Now, in Iraq's view, Iran has no one to call on who would be willing to help.

Although Iraq's population of 13 million is only a third that of Iran's, the Iraqi armed forces, in the estimation of Western analysts, is now the most powerful in the Middle East, except for Israel.

Its Army numbers 190,000 its Air Force 28,000 and its Navy 4,000 forces.

Before the revolution, Iran had an Army of 285,000, a Navy of 30,000 and an Air Force of 100,000. Defense Minister Mustafa Ali Chamran said last month that the total force was down about 25 percent since then, but U.S. and other Western observers think it is much smaller.

Chamran acknowledged that only about 25 percent of Iran's 350 combat aircraft were airworthy and other reports have said that its Navy, once a major force in the Persian Gulf, is largely inoperable because of lack of maintenance.

Iraq's Air Force includes 339 combat aircraft, most of them aging but reportedly well-maintained Soviet fighters and bombers.