Secretary General Kurt Waldeim for the first time has endorsed the concept of a Palestinian right to statehood.

Waldheim's remarks, made in an off-the-cuff speech to an Arab League dinner here Friday night, provoked a bitter denunciation from Israel today.

Israeli Ambassador Yehuda Blum charged that "the secretary general has exceeded the limits of his office" by putting himself "squarely on the side of one of the parties in the Arab-Israel conflict."

Blum went further, suggesting that Waldhedim's motive was designed as "the announcement of his bid for a third term in office." The secretary general's second term expires at the end of 1981.

The Waldheim statement, a transcript of which was released by the Arab League today, calls the Palestinian issue the core of the Middle East problem, and says that no comprehensive settlement can be reached until it is resolved.

"This means," Waldheim went on, "that foreign forces have to be withdrawn from the occupied territories including East Jerusalem. It also means that the legitimate rights of the Palestinians have to be respected. They have a right to self-determination, including statehood. The representative of the Palestinian people, the PLO, has to participate in the negotiating process."

Waldheim has referred before to self-determination, Palestinian rights, and a PLO role in future talks. He admitted that this was his first reference to statehood, but added: "I have not changed my attituede. I was surprised at the reaction because I have said similar things in the past. Statehood is inherent in the right oof self-determination, I certanily have not called for the creation of a Palestinian state, as some news reports have charged."

The uproar over Waldheim's remarks came on the eve of a vote on a resolution spelling out Palestinian rights that will conclude a week-long special emergency session of the General Assembly. The resolution, which has been toned down considerably from its earlier drafts, calls on Israel to withdraw unconditionally by Nov. 15 from all territories occupied since 1967, including Jerusalem.