Israeli troops clashed with Palestinian, Syrian and leftist Lebanese forces in besieged West Beirut and its southern suburbs today as the seventh U.S.-mediated cease-fire in the Lebanon crisis broke down.

Following 3 1/2 hours of heavy fighting, which included a simultaneous assault by Israeli warplanes, gunboats, tanks and artillery, U.S. special envoy Philip C. Habib arranged yet another cease-fire. It took effect at 9 p.m. here (3 p.m. EDT).

But the Israeli military command in Tel Aviv issued a statement at midnight saying that the Palestinians were still shooting and had wounded two Israeli soldiers, The Associated Press reported.

"The terrorists continued to breach the cease-fire by bazooka shelling after the Israeli defense forces stopped firing at 9 p.m.," the statement said.

An Israeli military spokesman in Tel Aviv cited Palestinian violations of the original truce, announced Wednesday night, in justifying the Israeli assault this afternoon. He said Israel would not accept a "one-sided" cease-fire.

The Palestinian news agency, Wafa, accused the Israelis of breaking the cease-fire with their attack.

There was no immediate estimate of today's casualties, but the wail of ambulance sirens was heard repeatedly in the largely deserted streets. Wafa said "numerous civilians were caught outside their homes in the sudden attack" and added "it is believed casualties were heavy."

The day had begun with a display of official Lebanese optimism about the chances of successful negotiations to evacuate the Palestinian guerrillas from West Beirut.

Saeb Salam, the veteran former prime minister who has served as a conduit between the Palestinians and Habib, told reporters that he expected an agreement between the Palestine Liberation Organization and Lebanese government "in a week to 10 days."

The enthusiasm appeared contagious, with garbage trucks working for the first time in 10 days and hundreds of cars waiting their turn to go through the checkpoint into West Beirut from the Christian eastern sector controlled by Israeli troops.

But the optimism was shattered late this afternoon by the Israeli attack. Palestinian officials and many Lebanese said they believed the ferocity of the assault was meant as a signal to the PLO that more concessions were required to avoid an all-out attack against the predominantly Moslem western sector of the capital.

Visitors to the American ambassadorial residence in the hills above Beirut, where Habib lives and works, said they have come away with the impression that Israeli Prime Minister Menachem Begin is determined to keep up the military pressure during the present negotiations.

Prime Minister Shafiq Wazzan accused Israel of purposely picking political rather than military targets in order to press home its demands.

"If this is the case then we have the right to ask why negotiations should continue," he said on state-run radio, "and why should we approve of some of the things that we have accepted as the price for saving the capital?"

Israeli Kfir fighter-bombers pounded a new target in today's attack, the Verdun Street area in the central city. The street is named after the World War I battle famed for its massive casualties.

Habib, despite successfully negotiating the cease-fires, so far has been unable to persuade Israel to reestablish water and electricity supplies cut off five days ago to West Beirut and part of the eastern sector.

The Israelis today also refused to allow $1 million of U.S. government-provided medical supplies--clearly identified with the clasped hand symbol of the U.S. Agency for International Development--to enter West Beirut.

The medicine, earmarked for the American University of Beirut's hospital, was stopped in the Israeli-controlled port for hours until the U.S. Embassy asked the International Committee of the Red Cross to intervene. The supply eventually was allowed through.

West Beirut's water problem has grown so acute that Raymond Naimy, chief water engineer for the United Nations Children's Fund, told reporters, "Another day like this will be very serious."

"We don't know what to do," said Naimy. "We don't have the means to solve the problem."

Although West Beirut possesses about 150 wells--which saw it through a similar travail when Syrian troops laid siege just six years ago--their water is brackish and in some cases contaminated.

As is usual during Beirut summers, typhoid cases have already been reported. Francois Remy, UNICEF's regional director, told reporters, "all conditions for a water-borne epidemic are there" and warned that typhoid and paratyphoid could spread rapidly if the city water supply was not restored within the next few days.

The Israelis also have sought to tighten their blockade, periodically suspending food supplies despite earlier promises to the ICRC to allow 185 tons of flour into West Beirut daily. Israeli troops also burned three vegetable-laden trucks caught on side roads near the southern suburbs' front line.

Even Camille Chamoun, the 82-year-old Maronite Catholic and former Lebanese president who has supported the Israeli invasion, criticized the blockade. "This cruel and unjustifiable treatment of innocent civilians must stop," he said.

On the diplomatic front, Lebanese Foreign Minister Fuad Boutros returned from the Arab League foreign ministers' meeting in Jeddah, Saudi Arabia, and was reported by reliable sources to be "not optimistic."

It was learned that both Boutros and Habib had rejected a PLO timetable that, depending on various versions, had proposed that Palestinian regular troops evacuate Lebanon over a period ranging from three weeks to two months.

Former prime minister Salam, who predicted a withdrawal agreement within the next 10 days, said a PLO evacuation would take place by road to Syria, which along with Egypt and Jordan has been mentioned as an eventual destination for the departing Palestinian troops. However, other problems remained unsolved.

The most serious--and most intangible--was a widely held Palestinian view that PLO troops had withstood the recent Israeli attack and emerged relatively intact and so did not want to accept the terms that Habib was offering.

Another problem involved Palestinian officials' insistence that only regular troops of the Palestine Liberation Army should leave. The guerrillas, especially those of the Fatah organization run by PLO Chairman Yasser Arafat, would remain in Lebanon, these officials said.

Then there was the question of who should be classified as a guerrilla. The Palestinians have argued that most of the guerrillas are part-time fighters who should return to their civilian roles as students, plumbers, engineers or laborers after a settlement.

These and other key details were to be discussed tonight at a meeting between high-ranking PLO and Lebanese Army officers. But over the last month and a half, such meetings have been called time and again, but have yet to produce any visible progress on an overall settlement.

Not all the problems were of Palestinian making. Israeli radio today said its troops would not discreetly leave their positions controlling the Beirut-Damascus road along which any Palestinian evacuation was expected to take place.

Earlier this month, Habib had promised to make the Israelis "invisible" on that highway to avoid humiliating the departing Palestinians.

Yet another apparent disagreement concerned the Palestinian request for a staging area in the Bekaa Valley in eastern Lebanon for PLO fighters withdrawing to Syria. That option had been rejected by the Lebanese government, Habib and Israel, Israeli radio reported.

The PLO, moreover, is also demanding that the international peace-keeping force, which it is thought would include U.S. Marines and French paratroopers as well as Greek and Italian contingents, be under United Nations auspices.

Israel, long at loggerheads with the United Nations, has rejected any such role for the world body.