SAN SALVADOR, OCT. 29 -- Leftist rebels broke off peace talks with the Salvadoran government today and announced a new military campaign in response to the killing of a human rights activist.

"Faced with the escalating wave of repression, we have decided not to participate in the talks with the government regarding a cease-fire or other aspects of the regional peace accord, scheduled to be held in Mexico City Oct. 30 to Nov. 4," said a communique released by the high command of the Farabundo Marti National Liberation Front.

Government spokesman Roberto Viera said the government had not been officially notified of the decision by the talks' mediator, Archbishop Arturo Rivera y Damas.

"We will first see what the archbishop says, and we believe we should continue by rational means to try to end the war," Viera said. "We should not become discouraged or lose faith, but this sets back the process."

Herbert Anaya, president of the private Human Rights Commission, was assassinated Monday. Anaya, 33, was an outspoken critic of the government and armed forces and had earlier been arrested and reportedly tortured by state security forces.

The Human Rights Commission and rebels accused government security forces of the killing, a charge denied by authorities.

Attending next week's round of talks "would only create false expectations and take attention away from the crimes against our people," the rebel statement said.

While it said the insurgents may choose to continue the talks at a future date, the rebels' clandestine Radio Venceremos announced "a new military campaign called 'Justice and Punishment for the Country's Criminals' in response to the criminal assassination of Herbert Anaya."

Thousands of demonstrators faced riot police and troops in a tense confrontation following a march through San Salvador during yesterday's day of "national indignation" to protest Anaya's killing. There were no reports of injuries or arrests.

Insurgents held talks with President Jose Napoleon Duarte Oct. 4 and 5 and agreed to continue to meet outside the country to attempt to negotiate a cease-fire, as called for under a regional peace plan. The plan, signed by the five Central American presidents Aug. 7, calls for an end to the region's civil wars, amnesty for rebels and democratic changes.

"We want the process to continue, but it does not make sense to talk when the people are suffering repression," an FMLN spokesman said in a telephone interview.

At a news conference yesterday, after returning from a two-week trip to the United States and Europe, Duarte announced a $10,000 reward for information leading to the arrest of Anaya's killers and said he had formed a special commission to investigate the murder. Similiar commissions, such as the one still investigating the 1980 murder of archbishop Oscar Romero, have had little success.