Israeli warplanes staged one of their most devastating and sustained aerial bombardments of West Beirut to date today, causing outraged Lebanese officials to suspend almost completed negotiations with U.S. special envoy Philip C. Habib for the peaceful withdrawal of trapped Palestinian guerrillas from the Lebanese capital.

With Habib having just returned from Jerusalem to iron out the final details of an evacuation agreement, Israeli jets struck in a 10-hour assault, hitting Palestinian positions along the capital's southern outskirts as well as striking at numerous targets in and around the more densely populated civilian areas near the city center.

Israeli radio said late this afternoon that the Israelis had declared another cease-fire. But shelling from Israeli gunboats and artillery continued until after dark and intermittent explosions could be heard well into the night.

Lebanese police said today's death toll was at least 128, with at least 400 wounded. Palestine radio said 300 persons were killed or wounded, with 400 houses destroyed. In the confusion of the day there could be no independent verification of the figures.

Palestine Liberation Organization representative Zehdi Labib Terzi told a U.N. Security Council meeting in New York that 500 persons were killed or wounded and 600 homes destroyed. He said 1,600 bombs and rockets were dropped on the city and 42,000 shells fired by land and sea-based Israeli artillery.

The air raids, which began at 6 a.m. and continued until shortly after 4 p.m., disrupted what was to have been a final negotiating session among Habib, Lebanese President Elias Sarkis and Prime Minister Shafiq Wazzan at the presidential palace in suburban Baabda. Wazzan stormed out of the meeting and announced that the delicate talks, which had seemed on the verge of producing agreement, had been suspended indefinitely.

The talks were being held to work out a formula to evacuate the estimated 5,000 to 10,000 Palestinian guerrillas besieged in the city by the Israelis and to establish a temporary international peace-keeping force composed of French, U.S. and Italian units.

"I cannot continue with the negotiations in such an atmosphere," the prime minister said in a voice cracking with emotion. "Why all this destruction? Why all this killing? What more do they the Israelis want of us? They are destroying Lebanon and its beloved capital."

Wazzan also denounced the United States for not preventing the Israeli attack. He said of Habib, "I have told him I cannot carry on and hold him as well as the United States responsible for the consequences."

The prime minister decided to suspend participation in the talks after being urged to do so by former prime minister Saeb Salam, Habib's chief intermediary in discussions with the PLO.

Salam phoned Wazzan at Baabda after canvassing Lebanese Moslem leaders and Palestinian officials who streamed in and out of his home in West Beirut throughout the day. Salam also urged Sarkis to make a public declaration calling on world leaders to force Israel to halt its attacks.

But Sarkis, a Maronite Christian, refused to make the declaration and instead sent a letter to President Reagan and telephoned Saudi Arabian King Fahd to urge him to intercede directly with the U.S. president.

Salam termed the Israeli air raid a "barbarous and savage" act that he said convinced him that Israel was not interested in a peaceful solution but was stalling in the negotiations because it sought the "total destruction of Beirut and of the people in it, both Palestinian and Lebanese."

Salam said Israel had given Habib a list of four conditions, including a demand for a roster with the names of up to 13,000 PLO guerrillas and Syrian soldiers who the Israelis said would have to be evacuated. He said Israel also was insisting on written commitments from all of the Arab governments that have agreed to accept the guerrillas and is holding to its demand that most of the fighters be withdrawn before the international force is deployed.

Finally, he said, the Israelis are insisting that the day the evacuation begins be renamed "E-Day," instead of "D-Day," because of the historical meaning of the latter term, which was used to describe the Allied invasion of Normandy during World War II.

The air raids were the latest phase of a steady four-day escalation of attacks that Israeli officials say were launched in retaliation for Palestinian shellings of their positions.

Israel also continued to reinforce its ground units surrounding West Beirut with new troops and equipment, Washington Post correspondent Leon Dash reported from East Beirut. According to a recent traveler to southern Lebanon, U.N. peace-keeping forces there have counted a mechanized division and two brigades coming across the border from Israel in the last four days. New gun positions have been dug in the south of Beirut, some with large field guns and Soviet Union-made Katyusha rocket launchers captured from the Palestinians.

Col. Yehiel Ben Zvi, an Israeli military spokesman in East Beirut, confirmed today that in the "past day or two we have intentionally reinforced our troops in the Beirut area and they are deployed around the city. We are preparing very seriously for a military option in the event that diplomacy fails."

Today's air raids began at dawn after a night of intense artillery bombardment of the city. Palestinian positions in the neighborhoods and refugee camps around the city's southern outskirts were hit, as well as targets in and around the heavily populated residential district in the heart of West Beirut.

With the city's estimated 400,000 remaining residents still reeling from a sleepless night spent in basements where many of them now live, Israeli planes, trailing thermal balloons to deflect heat-seeking antiaircraft rockets, began their attack.

The bombing was most intense around the refugee camps of Burj al Barajinah, Sabra and Shatila and in the Fakhani district, where many PLO offices are located and where the Israelis suspect that some of PLO leader Yasser Arafat's command bunkers lie.

The planes, using 1,000-pound bombs, rockets, and high-velocity cannon fire, also raked buildings along the Corniche Mazraa, the boulevard that runs from the sea to the National Museum crossing point to East Beirut. It is there that Israeli and Palestinian forces have fought for the past few days for control of the entry point into the western sector in a battle that has involved tanks, artillery and rocket-propelled grenades.

Israeli forces advanced about 300 yards west from their previous lines this morning, but were forced to retreat by heavy Palestinian fire in the afternoon. Israel repeatedly has tried to advance from the museum to take the boulevard. Its capture would effectively cut off the Palestinian positions in the south from the heart of West Beirut north of the boulevard.

With gunboats participating, Israeli artillery also pounded the seaside Rawshah district, once a fashionable neighborhood of middle-class apartments, French restaurants and boutiques that is now crowded with refugees. Other strikes hit near the Hotel Normandie in the guerrilla stronghold near the Israeli-held port area, and around the Manara lighthouse district of high-rise apartments four blocks west of the campus of the American University of Beirut.

Palestinian gunners fired surface-to-air missiles at the invading planes and followed their roar with less modern antiaircraft guns, but neither appeared to be an effective threat to the Israeli jets.

By midafternoon the planes no longer were being followed by the rattle of antiaircraft fire either because the Palestinian gunners had run out of ammunition or because they had given up in futility.

Along the seaside near a Lebanese Army post known as the bain militaire and in sight of an old ferris wheel, a group of Lebanese militiamen of the pro-Syrian Arab Socialist Movement saw its camp in an old soccer field attacked by a Kfir jet that dropped eight 1,000-pound bombs in a dive seen from the center of the city.

Almost as soon as the air raid stopped, the militiamen were out in the cratered streets exchanging stories and joking with each other about how the Israelis had failed either to knock out any of their antiaircraft batteries or to wound any of the men.

"We are all fine, our morale is strong," said Zaid, the group's 22-year-old commander, as others nodded in assent. "It is not a question of whether we can take this for days, we can take this for months."

Down the Corniche Mazraa, where fresh glass blown out from neighboring buildings was intermixed with dangling electrical wires along the four-lane boulevard, ambulances raced with lights flashing and sirens wailing, rushing victims dug out of buildings to the nearest hospital. After half an hour of calm, residents began to emerge from cellars to survey the damage and chat on littered sidewalks as the sun began to set.

"What is the sense of all this killing?" asked Ihsam Haj as he surveyed the damage in the neighborhood while the distant crump of artillery still landed in a refugee camp a mile or so to the south.

He added, "What do the Israelis want? Are they crazy? The Palestinians have said they are ready to go, so why don't they let them? Why do they continue to bomb us like this? There is no sense left in this world."