Drought, revolution and a centuries-old territorial battle between the peoples of Somalia and Ethiopia have flared again into a potential East-West conflict and are creating an international refugee crisis that could rival that involving the Palestinians.

Well over 1 million persons have fled the Ethiopian-ruled Ogaden region for Somalia, meaning that one of four persons living in that country is a refugee.

With the possible exception of Afghan refugees in Pakistan, the Horn of Africa is now the site of the world's largest concentration of displaced persons, the bulk of them in Somalia and the others in Sudan and Djibouti. [Related stories on Page A19].

Western countries and the United Nations are pouring $132 million in emergency relief this year into Somalia, which has a gross national product of $400 million. But the international assistance, although vital, is really "only putting a Band-Aid over the problem," one volunteer agency official said.

Somalia could well become another Lebanon, host to a huge refugee community simmering with frustrated national ambitions just like those of the Palestinians. Some relief officials acknowledge that in a sense they are indirectly exacerbating the situation, since their efforts make it easier for the Ethiopians and Somalis to continue their centuries-old feud over the desolate Ogaden region.

From a spear-and-sword conflict between Christian highlanders and Moslem lowlanders, it has grown into a large-scale, modern-day war. The conflict is fueled by millions of dollars of sophisticated arms poured into the region primarily by the Soviet Union and the United States in their search for allies and access to the two countries' strategically located ports and airfields along the Indian Ocean and Red Sea.

By all accounts, Ethiopia -- with more than $1 billion in Soviet arms and 15,000 Cuban troops -- now leads in the fight. But the United States has offered Somalia an initial $40 million in military aid in return for the use of Somali facilities only 150 miles from the Ethiopian border.

Since its independence in 1960, Somalia has sought to bring the Somali-speaking people of Ethiopia, Kenya and Djibouti under one flag, causing frequent hostilities. For all Somali governments, this has been an article of faith, now altered slightly to a call simply for self-determination. a

For Ethiopia, the loss of the Ogaden would probably begin the dismemberment of the country, a conglomeration of 36 tribes welded into an empire by 19th and 20th century emperors Menelik and Haile Selassie.

Known by the Somalis as Western Somalia, populated by Somali nomads who are ruled by Ethiopia, the Ogaden is a parched, barren area slightly larger than New Mexico. Acacias and thorn trees are the principal vegetation. Anthills, often twice the height of a camel, and 100-foot high whirlwinds dominate the landscape. It is usually impossible to tell which side of the border one is on since the boundary often is just a washed-out track.

Yet probably 50,000 people have been killed in the last two decades in two wars and numerous battles waged by the enemy neighbors for control of the territory, which comprises about one-third of Ethiopia.

The refugees, mainly women and children, have become a political football in the conflict, used by Somalia to gain sympathy while their protection in the camps allows the men to go on fighting for the Western Somali Liberation Front.

Although the massive international relief effort has averted an immediate threat of starvation, there is considerable malnutrition. Refugee camps the size of small cities grow up virtually overnight in Somalia, destroying the culture of the nomads, imperiling the delicate semi-desert ecological balance and making it even less likely that the refugees will be able to feed themselves in the future.

Meanwhile, the fighting goes on.