After years of exile in Europe and the United States, the proud Arabian horse of legend and poetry is being repatriated to the land where it once reigned nobly, its renaissance nearly as abrupt as its disapperance.

In this vast kibbutz near the Mediterranean city of Netanya, Yiftak Levron's dream of bringing the Arabian horse bcak home is beginning to materialize.

Sleek mares imported from California and New York graze lazily in the warm sun, while foals cavort in the lush pasture. Young kibbutzniks proudly groom the growing herd, talking confidently of the day when the market for pure Arabians bred in Israel will be what it once was in the ancient Holy Land.

"For centuries, the Arabian has been known as the best horse in the world; there's no reason that this breed should be associated more with the United States and England than it is here," said Levron, a 30-year-old native Israeli who manages the kibbutz's Sabra Arabians breeding farm.

From before the time when the prophet Mohammed made his legendary night ride to Jerusalem and is said to have ascended to heaven astride his steed, Barak, the Arabian horse reigned in the land of Palestein.

King Solomon bred magnificent strains of Arabians in his Jerusalem stables, purchasing mares from the Arabian peninsula and selling their offspring to other kings of the region. The charioteers of the Hitties and the armies of Egypt and Persia relied on the nerve and speed of the Arabian. The Macedonians, the Byzantines, the crusaders and the Turkish Ottomans owed their conquests to the fleet-footed breed.

But the supremacy of the Arabians of Palestein began to wane in World War I, when a departing Austrian cavalry division left behind hundreds of cross-bred horses, called "whales," and the incoming British Army brought in hunters, hacks and other horses favored by the cavalry then.

When the British left Palestein in 1948, they took with them most of the good Arabians. The purebreds left behind diminished in number as the government of modern Israel began importing sturdy, cross bred work horses from Hungary, Yugoslavia, Bulgaria and Norway because they were favored by Israeli farmers.

"They degraded the original desert strain," Levron said. "Almost overnigh, the Arabian disappeared from the place of his roots."

A revival of interest in the Arabian began in 1967, when a horseman named Kurt Lowenthal met Count Stefan Zamoyski, an aficionado of Arabians, in London. Zamoyski established a purchasing commission to export Arabians to Israel, and an industry was launched.

Kibbutz Givat Haim Ichud imported the first pure Arabians in 1976. They were donated by prominent Arabian breeders Yale Freed, owner of Briarwood Farms in Solvang, Calif., and N. E. Derecktor, of White Plains, N.Y.

Many members of the kibbutz fiercely opposed the venture, recalled Willie Gilbert, who assists Levron at Sabra Arabians.

"This didn't seem to be in the kibbutz tradition of hard work with the soil," Gilbert said. "A lot of people here thought it was a little too aristocratic or country clubbish for a socialist kibbutz. A lot of them still do, but the wall of resistance is crumbling. ."

Decisions on investments in kibbutz ventures are made by communal consensus, and Levron had to persuade his colleagues that $4,000 spent for shipping a horse across the Atlantic could yield much more. Mares can produce a foal a year, and good Arabians can bring $10,000 or more abroad.

"The first tow years of a horse's life are critical," Levron said. "He needs good climate, lots of sunshine and exercise. The conditions in Israel are perfect for breeding and raising horses."

The only other country in the Middle East where the pure Arabian ideal survives, Levron noted, is Egypt, although even there the stiff competition from abroad has caused interest to flag. Jordan and Saudi Arabi still breed some Arabians, but nothing on the scale of which Levron is thinking.

"When people think of Arabians, I want them to think of Israel," he said. "I don't want to breed the best Arabians in the Middle East. I want to breed the best Arabians in the world."

To do that, he is attempting to return to the strain that is indigenous to the area, with a smaller head and slightly smaller body than the European-bred Arabians.

Sabra Arabians now has 15 pure Arabians, including 10 mares who are producing about six foals a year, and Levron's ambition is to build up the herd to the point where he can start selling in about five years. A potential market, he says, is the United States.

"Now Americans are buying Arabians from England, Sweden and other places in Europe," Levron said. "Why not from the Middle East, where they originated?"

Arabians, he said, can be used for racing, hunting, showing and jumping, and he thinks those bred in the Middle East should have an enhanced value abroad.

Similar Arabian breeding programs are getting underway at another Israel kibbutz, Shaar Hagolan, in the Jordan Valley, and at the new Cashvan Equine Center, associated with the Ben-Gurion University of the Negev.

Since he was a boy, Levron said, he dreamed of raising pure Arabians and restoring their prominence here. Now, he said he saw his dream coming true.

"I'm proud of Israel, and I'm proud of my horses," he said. "The two belong together."