As mourners chanted the prayers for the dead here today over the body of a slain Palestinian peace advocate, a grief-stricken Jewish editor stood with the throngs on the steps of the big modern Moslem mosque, fighting tears and cursing what he called the "war camp" for the murder of his friend.

The funeral for Issam Sartawi, a Palestine Liberation Organization moderate who sought to bring together Palestinians and sympathetic Israelis, came as something of a symbolic epilogue to a week that began with the declaration of the failure of the latest round of efforts to bring about peace in the Middle East.

In the aftermath, there is an air of recrimination, with some of the blame-seeking being argued out here today as they buried Sartawi's body.

For other PLO moderates, Sartawi's death was, as his Jewish friend Maxim Ghilan put it bitterly, "an expression of the struggle of the Israeli-Palestinian peace camp on the one side and the hawks of the war camp on the other."

"Today, they will be celebrating in both Jerusalem and Damascus," said Ghilan, an author and editor of a Paris-based monthly who holds both French and Israeli citizenship. But for both Ghilan and PLO moderates, the problem now is how to keep open a dialogue and momentum toward peace.

A Damascus-based, breakaway PLO terrorist group claimed responsibility for Sartawi's murder Sunday in the lobby of a hotel in Portugal. But for many of the Palestinian schoolboys and PLO operatives at services here today, there was no way they could be convinced that blame did not lie with the Israelis. Only hours after the assassination, PLO leaders issued press releases indicting the "Zionist enemy" for the assault.

Posters bearing Sartawi's photograph that were taped to the big white hearse leading a mile-long cortege to the cemetery hailed him as "the martyred leader."

Although close to PLO Chairman Yasser Arafat, for whom he had arranged a meeting with prominent Israeli leftists earlier this year, Sartawi's power in the PLO was negligible because of suspicions about his closeness to Israelis.

But his death came as a chilling blow, especially because it coincided with the declaration Sunday by Jordan's King Hussein that his eight months of effort to reach an accommodation with Arafat to respond positively to President Reagan's Middle East initiative had ended in failure.

Sartawi's murder had deeply concerned other PLO moderates not only because of the fear of personal danger but because, coming in a period of renewed stalemate, it threatened to silence the voices of those at the cutting edge of change.

"The problem is that the Palestinians are not afraid of this process of assassination," said one senior PLO aide, also a moderate. "In a stalemate, if the voices who want to achieve something are helpless, then they are isolated and then they are assassinated.

"The Arabs are not helping. The Israelis are unwilling to do anything. The Americans aren't serious. So what should the Palestinians do?"

As he walked around a PLO office here this morning before going off to Sartawi's funeral, the moderate reflected dissatisfaction with what he said was the failure of Palestinians to agree on a common strategy.

His complaint seemed to find focus in the routine confusion of the office. Phones rang and were not answered. Officials wandered from room to room, profusely apologizing when they barged in on others' meetings. There was a clatter of hammers as workers repaired a wall. Others were mopping a floor flooded with water. They bumped into others who, for some reason, were carting around heavy bags of cement.

"I have been coming to this office for three years and I still can't tell who is in charge," said the moderate.

It was criticism not unlike that coming from Jordanians and Americans about the failure of the Hussein-Arafat negotiations. The indictment is that the PLO is disorganized and, in that confusion, ruled over by a radical minority.

Hussein reportedly told British Foreign Minister Francis Pym yesterday that he held hopes that his Sunday declaration would have some "shock value."

By threatening to sever Jordan's link with Palestinians on the Israeli-occupied West Bank and handing over responsibility for them to the PLO, Hussein, with the apparent strong backing of the United States, appears to be pressuring the PLO to change or, in the alternative, to crush the organization.

Sources here said Hussein intends to bring the PLO's own limited operations here under "rigorous scrutiny" and that Arafat's hope of shifting his base of operations from Tunis to Amman was effectively "torpedoed" when he failed to come to agreement with Hussein.

The sources said the Jordanian monarch now intends to keep a very careful watch over the movement of both people and goods from the West Bank into Jordan and is considering curtailing trade.

The threats deeply concern the PLO moderate. For one thing, he said, the PLO is incapable of delivering the money and services to Palestinians on the West Bank if only because the Israelis would not allow them access as they have the Jordanians.

He expressed anxiety about the plight of West Bank Palestinians if the link is broken and was troubled that the strategy could backfire disastrously. Even before the talks collapsed, he said, there were divisions among those favoring compromise and those committed to armed struggle.

"How deep these contradictions are going to grow depends on how far the gap between the PLO and Jordan becomes," he said.

The family of Issam Sartawi chose to eliminate the traditional 21-gun salute customary at PLO funerals. His widow and sisters stood in a circle quietly weeping. Veteran watchers of such events said it was a subdued affair and without the usual loud wailing.

Arafat's deputy, Abu Jihad, stood with Sartawi's 14-year-old son Omar as a long line of men passed by kissing him to pay tribute to his father.

But there were no other ranking PLO officials present. Hussein, who had visited Sartawi's relatives earlier this week, was represented by his court chamberlain.

There was no official representative from the United States, which has a policy of refusing to have contact with the PLO.

The only big power represented was France, whose ambassador, Jacques Alain de Sedouy, said he came at the request of Foreign Minister Claude Cheysson.

"Sartawi was a man of peace and dialogue," he said. "We believe in peace and dialogue."

Sartawi's casket, draped in the PLO flag, was lowered into a small tomb in the martyrs' section of a cemetery on the outskirts of Amman. Next to it are the graves of Kamel Yousseff, a PLO aide assassinated in Italy in 1980, and Said Hammami, a PLO aide shot and killed in London in 1978.

On Hammami's tomb was a map of Palestine inscribed in English and Arabic: "I died for some of the things I believe in."