Secretary of State George P. Shultz, citing "associations with terrorism," yesterday barred PLO Chairman Yasser Arafat from flying to New York this week to address the United Nations General Assembly.

Shultz's surprise decision to reject Arafat's application for a U.S. visa, which is likely to be among the most controversial of his stewardship of U.S. diplomacy, was described by State Department officials as an unusually personal act arising from his abhorrence of terrorism. Sources said Shultz went against the advice of the department's Middle East experts and of Undersecretary of State Michael H. Armacost. The White House said President Reagan was not involved in the decision.

{Arafat declined to comment on the U.S. action on his arrival last night in Amman, Jordan, for meetings with King Hussein, but was expected to speak with reporters today, United Press International reported.

{PLO political adviser Bassam Abu Sharif, who was traveling with Arafat, said, "the American administration committed a big mistake . . . . If Arafat is a terrorist, he is as much a terrorist as George Washington."}

{Earlier, a PLO spokesman in Tunis told UPI that the visa denial violates U.S. obligations to the United Nations and means "the Americans have rejected any chance for peace in the Middle East."}

Under a 1947 headquarters agreement with the United Nations, the United States is committed to facilitating business travel to the world body. In approving the agreement, however, Congress retained authority to bar the travel of aliens on national security grounds.

This authority was cited by Shultz in a written statement released at 2 p.m. yesterday. Aides said he made the decision overnight after hearing arguments on all sides from State Department officials Friday.

"The PLO through certain of its elements has employed terrorism against Americans," said the State Department, which cited the killing of a wheelchair-bound American, Leon Klinghoffer, during the October 1985 hijacking of the Italian cruise ship, the Achille Lauro.

"Mr. Arafat, as chairman of the PLO, knows of, condones and lends support to such acts; he, therefore, is an accessory to such terrorism," the statement said.

Aides said Shultz was particularly indignant that Abu Abbas, a PLO executive committee member who was convicted in absentia in Italy of the murder of Klinghoffer, was present at the Algiers meeting this month of the Palestine National Council, the PLO's legislative arm. Abbas was quoted by a New York Times correspondent in Algiers as saying with a half-smile of Klinghoffer, who was shot and dumped overboard, "maybe he was trying to swim for it."

Shultz, who unsuccessfully sought to restart the stalled Arab-Israeli peace process in a burst of personal diplomacy last spring and summer, acknowledged that the recent PLO legislative session in Algiers "produced signs that there are Palestinians who are trying to move the PLO in a constructive way."

"This is encouraging and should continue," the statement said. But it added that "the blight of terrorism still afflicts the Palestinian cause and leaves no alternative to decisions such as the secretary has taken today."

Arab and Western European governments in recent days sought to persuade the United States to take a more positive view of the PLO shifts at the Algiers meeting on grounds this would encourage further movement. The meeting for the first time voted to accept U.N. Resolution 242, a basic underpinning of Arab-Israeli diplomacy. It also proclaimed an independent Palestinian state in the West Bank and Gaza Strip.

Ambassador Clovis Maksoud, permanent representative of the Arab League to the United Nations, said at least 12 Arab foreign ministers, including those of Egypt and Saudi Arabia, had planned to come to the United Nations later this week for the debate on Palestine that Arafat had hoped to address.

Maksoud, who said Shultz's decision "signals that moderation is costly and appears to be inconsequential to the U.S. administration," reported that Arab diplomats will probably ask that the Palestine debate be postponed and, in an extraordinary gesture, moved from New York to Geneva.

In an interview with the Kuwaiti news agency before the State Department announcement, Arafat said he would urge the transfer of the debate to Geneva if he were denied a visa. "This is our right and the right of our friends, so that we can work freely and without blackmail from Israel and others at U.N. headquarters," he said.

A senior Arab diplomat here, who asked not to be identified, called Shultz's decision "a tragedy" and said it will bring "a great letdown for Arab leaders who stuck their necks out based on Shultz's urging." The diplomat said Shultz in his last trip to the region spoke to Arab leaders of the need to urge the Palestinians "to be flexible and cooperative" to restart the peace process.

The Israeli Embassy through spokesman Yossi Gal called Shultz's decision "very encouraging as an expression of the determination of the United States to fight against terrorism."

The immediate reactions of U.S. groups was as expected, with Arab-American spokesmen decrying the decision and Jewish-American spokesmen hailing it.

Former senator James Abourezk, chairman of the American-Arab Anti-Discrimination Committee, called the decision "both embarrassing and against American interests." He said, "it is shameful that Secretary of State Shultz would allow Israel to dictate whom the American people can or cannot hear."

Ira Silverman, executive vice president of the American Jewish Committee, said he was "gratified" by Shultz's action. "The whole civilized world was shocked when {Arafat} wore a gun on last addressing the United Nations. We have no reason to think he is any less a supporter of terrorism and an enemy of Israel than he was then."

Abraham H. Foxman, national director of the Anti-Defamation League of B'nai B'rith, called the decision "a welcome and courageous blow by the secretary of state against international terrorism."

Arafat was given a U.S. visa to address the United Nations in November 1974, when Henry A. Kissinger was secretary of state. A State Department official said the major change since then was the rise of terrorism as a national and international issue.

Policy-making about his appearance began Nov. 8, shortly before the Algiers conference was convened, when the PLO notified the United Nations it wanted a visa for Arafat to address the General Assembly in early December. The United Nations notified the State Department and asked that the visa be expedited but State, in an unusual move, required that the PLO chairman apply in person for the travel document. Arafat and three aides did so Friday through the U.S. Embassy in Tunis.

Meanwhile, 51 members of the Senate sent a letter to Shultz urging that the visa application be denied. The letter was sponsored by Sen. Dennis DeConcini (D-Ariz.).

Because the law governing visa applications gives decision-making responsibility to the secretary of state, Shultz took unusual latitude in deciding the Arafat issue himself. A White House spokesman in Santa Barbara, Calif., where Reagan is spending Thanksgiving vacation at his mountain-top ranch, said Reagan "had no role in the decision" but was aware of it.

A State Department official said Reagan had been briefed on the decision and "was comfortable with it." The official said he did not believe Shultz had consulted either President-elect George Bush or Secretary of State-designate James A. Baker III, who will have to deal with the consequences of the decision. Bush told reporters, in a shouted exchange as he jogged in Kennebunkport, Maine, that he had no comment.

State's Bureau of International Organization Affairs and Office of Counter-Terrorism are reported to have urged Shultz to deny the visa to Arafat. State Department legal adviser Abraham Sofaer is said to have cited arguments on both sides.

The Bureau of Near Eastern and South Asian Affairs is said to have favored approval of the visa on grounds it would facilitate Mideast diplomacy. Undersecretary Armacost, State's third-ranking official, reportedly took the same view.

In contrast to the decision against Arafat, the PLO's "foreign minister" Farouk Kaddoumi was granted a visa last week and is expected to arrive in New York shortly. A State Department official said Kaddoumi had filed his request in early November.

Staff writer John Goshko contributed to this report.