Palestine Liberation Organization Chairman Yasser Arafat said today he believes Israeli forces on the outskirts of Beirut are "preparing for a big operation" but that guerrillas trapped in the city could withstand a long siege.

Speaking to reporters while visiting a heavily damaged Palestinian neighborhood in West Beirut, Arafat said the four-day-old cease-fire was a good sign. But he noted that the Israelis have moved up an armored and a mechanized brigade to the southern edge of Beirut.

"We think they are preparing for a big operation," he said as he cuddled a Palestinian baby girl whose mother had fled from Israeli-occupied south Lebanon. "I think Israeli Defense Minister Ariel Sharon is preparing for something new. Tell him I am waiting for him--with this small and beautiful baby."

Holding the infant, whose mother said her husband was killed when Israel attacked Sidon in south Lebanon, Arafat said: "Definitely, if you are in my place, you have nothing but to resist. It is our duty to defend our babies, to defend our people, to defend our women."

Arafat's remarks on a rubble-strewn street in the Fakhani district, where some PLO offices are located, followed a series of overflights, but no attacks, by Israeli warplanes for the second straight day. West Beirut residents seemed less frightened of them than yesterday, when mock air raids chased most people off the streets.

Earlier today and last night, sporadic exchanges of artillery and machine-gun fire were reported around the city's southern suburbs, but the cease-fire generally held. The Palestinian Wafa news agency said five Israelis tried but failed to move on positions near the airport. Israel reported one soldier wounded in shooting along the Damascus-Beirut highway at a spot controlled by Syrians.

There was no indication of any movement today in talks among U.S., Lebanese and Palestinian negotiators to seek a political solution of the crisis. Lebanese President Elias Sarkis was reported ill today and unable to meet with U.S. special envoy Philip Habib or others.

Meanwhile, two Cabinet ministers criticized a government statement issued last night calling for the withdrawal of all foreign forces from Lebanon and the introduction of a multinational force to ensure a Palestinian pullout from Beirut.

The two, backers of the pro-Palestinian Lebanese leftist National Movement, repudiated the statement's wording. They said they did not put "Israeli aggression" on the same level as the presence in Lebanon of Palestinian and Syrian forces, which technically are here under agreements signed by the Lebanese government.

The position of the two--Tourism Minister Marwan Hamadeh and Commerce Minister Khalid Jumblatt, both of the Druze sect--tended to undermine what initially appeared to be the Lebanese government's first unified public response to the current crisis.

In an interview, Hamadeh, who has been involved in the negotiations with Habib, said Israeli troops should withdraw before any pullout by Palestinian and Syrian forces. He said an international peace-keeping unit should enter Beirut first "to supervise the Israeli withdrawal and the implementation of a new agreement with the Palestinians that would" end their military presence.

According to diplomats, the questions of the timing of the international force's arrival and the destination of the evaucating Palestinians have become major sticking points in the negotiations, which appear to have unraveled somewhat in recent days since Syria announced its refusal to receive the Palestinian fighters.

The official Damascus radio--and Foreign Minister Abdul Halim Khaddam--today reiterated the refusal. The radio called on Arab states to strengthen the Palestinian foothold in Lebanon and "ensure that the fighters do not move from Beirut to any other country." It added that Arab countries "should insist on the need for withdrawal of the Zionist invaders from Lebanon first."

The statement also denied that the PLO had asked Syria to receive fighters evacuated from Beirut. However, in the sidewalk interview, Arafat said a proposal to Syria to take in PLO troops was "under discussion." Arafat seemed to play down the significance of any move to Syria. He noted that "my main headquarters is still in Syria" and that "we still have our camps and our military bases there." He referred to the transfer of the official seat of the PLO to Damascus from Egypt after the Camp David accords.

Asked if he were prepared to dig in for six months, he replied, "Why not? I have nothing to lose." Arafat said he was waiting for signs of any new American policy under Secretary of State-designate George P. Shultz. "It seems as if something is changing," he said. PHOTO:(AP): PLO leader Yasser Arafat greets a woman and child during a tour of West Beirut.