The Reagan administration, citing "significant steps" by Guatemala's military government in improving its human rights record, yesterday ended a five-year embargo on military aid to that Central American country by approving a $6.36 million sale of military spare parts.

The decision, whose symbolic importance greatly outweighs its monetary value, enables the regime headed by Gen. Efrain Rios Montt to obtain parts for heavy-duty UH1H helicopters used by the Guatemalan armed forces to fight a leftist guerrilla insurgency. In announcing the sale, State Department spokesman John Hughes asserted that Rios Montt, who took power after a military coup nine months ago, has achieved a "dramatic decline" in Guatemala's endemic political violence, curbed rights abuses and started his country toward a return to democracy.

"These are steps which we feel should be recognized and encouraged," Hughes said.

In a gesture to congressional human rights supporters who had opposed the sale, Hughes acknowledged that "the situation is not ideal" in Guatemala and stressed that "we want to see further progress in promoting respect for human rights."

However, the decision drew immediate criticism from rights advocates and congressional liberals who view the sale as confirmation of their charge that the administration, in its eagerness to combat leftist forces in Central America, has turned a blind eye to abuses and military dictatorship.

Rep. Tom Harkin (D-Iowa) and 77 other House members introduced legislation to block the sale. Their resolution charged that, contrary to administration claims, the Guatemalan government's use of martial law and failure to end or prosecute abuses by the military do not meet "minimum human rights standards."

Surprisingly harsh criticism also came from Rep. Michael D. Barnes (D-Md.), chairman of the House inter-American affairs subcommittee. Barnes spearheaded the congressional opposition that had forced the administration to delay the sale for 18 months, but he recently appeared to be modifying his position.

Barnes told The Washington Post last week that while he was still undecided about the sale, he had indications of improvement in the Guatemalan situation, and added: "I don't think it would be the most outrageous thing in the world to sell them these parts."

Yesterday, however, Barnes issued a lengthy statement in which he called the decision "most unfortunate" and said he had informed the State Department "as recently as this week of my view that military sales to Guatemala are not appropriate at this time."

He added, "It has also become clear in recent days, and I have so informed the administration, that the opposition to this sale in Congress will be more widespread and intense than I had realized. The American people are just not ready to resume a military relationship with Guatemala, and that will be reflected in the congressional reaction that will surely follow this announcement."

How strong the opposition will prove was not immediately clear.

Still, the administration's long delay in giving a green light to the sale was due, in large part, to fear that a hostile congressional reaction might endanger other key elements of the administration's Central American policy, including the substantially larger amounts of aid it is seeking for the fight against guerrillas in El Salvador.

Although the United States long had been Guatemala's principal military supplier, the relationship was broken off in 1978 because of human rights factors.

Subsequent attempts by both the Carter and Reagan administrations to revive it foundered in the face of congressional opposition; for more than two years, Guatemala's request for the helicopter parts has been the symbolic cutting edge of the dispute.

The administration's decision to move now was motivated by concern that Rios Montt might be deposed by hard-line elements in the Guatemalan military if he was unable to reestablish good relations with the United States.

After meeting with Rios Montt in Honduras last month, President Reagan declared that the general "is totally dedicated to democracy" and was getting a "bum rap" from critics in this country.

In response to questions about whether the administration now will seek a broader program of security assistance for Guatemala, Hughes stressed that the helicopter action was "a one-time decision" and that any future requests will be handled "case by case."

He noted, though, that the decision "is part of a broader relationship" that has seen the administration earmark $10 million in non-military economic aid for Guatemala under its Caribbean Basin initiative.

Barnes, who has said he would prefer to help Guatemala through development rather than military aid, noted yesterday that if Reagan seeks more economic assistance, "I will support him."