Dismayed by Western inaction in Bosnia, Saudi Arabia funded a $300 million covert operation to channel weapons to the Muslim-led government over the past three years with the knowledge and tacit cooperation of the United States, according to an official with firsthand knowledge of the operation.

The arms shipments, which were in addition to around $500 million in Saudi humanitarian aid, were in direct violation of a United Nations arms embargo on the former Yugoslavia that Washington had pledged to enforce.

The Bosnian program was modeled in some respects on the Afghanistan experience in the 1980s, when Saudi Arabia helped finance the covert arming of anti-Soviet Muslim fighters in an operation supported by a similar cast of former U.S. military and intelligence personnel and agents, according to a Saudi official, who spoke on condition that he remain unidentified. The essential difference was that the United States did not provide matching funds for the Bosnian arms-smuggling effort, in contrast to the Afghan operation.

The Saudi provided significant new details about the scope, timing and mode of operation of the program, of which only sketchy descriptions have been provided in the past by American and other Western officials. The official's decision to reveal the information appeared motivated in part by a desire to take some credit away from rival Iran for a series of military and diplomatic gains by the Bosnian Muslims in their battle with the Bosnian Serbs.

The Saudi assertion of U.S. cooperation in supplying arms to the Bosnian Muslims drew strong denials from American officials, as one senior White House official called the allegation "preposterous and insulting." Clinton administration officials have repeatedly denied persistent reports from European allied officials of U.S. involvement in arming the Bosnian Muslims during the 3 1/2-year Bosnian civil war.

The Saudi official provided few details about direct American involvement, but insisted that the American role "was more than just turning a blind eye to what was going on. . . . It was consent combined with stealth cooperation. . . . American knowledge began under {President George} Bush and became much greater under {President} Clinton."

The White House official said that the United States would not have attempted to mount such a covert operation because allied troops were on the ground in Bosnia as part of the U.N. peacekeeping force.

"Whatever the Saudis claim to have done was not in concert with us, or with our approval," the American official said. "We have not in any way coordinated, endorsed, or in any other way encouraged other countries to violate the arms embargo."

The Saudi official also said his country was ready to help finance a U.S.-led effort to bring the Bosnian government army up to the level of its Bosnian Serb enemy following the lifting of the U.N. arms embargo as a result of the Balkan peace accord. He said that negotiations were continuing on the financing of the program but that Saudi Arabia was prepared to donate "up to $50 million," or between 15 and 25 percent of the total cost.

The Saudi official played down the Iranian role in Bosnia, saying Tehran had "the loudest mouth" but did not contribute nearly as much money to the Muslim cause as Riyadh. According to Western officials, the Iranian contribution was significant, and included hundreds of volunteers, small arms, rocket-propelled grenades and humanitarian relief supplies. U.N. officials and Western diplomats spotted at least one Iranian Boeing 747 cargo plane filled with arms parked at Zagreb airport in 1994.

The Saudi official said that most of the Saudi assistance to the Bosnian Muslims was channeled through Croatia, which controls Bosnia's access to the sea and Western Europe, and took its own cut of up to 50 percent on all arms deliveries. Some emergency deliveries were made in the form of secret nighttime flights to Tuzla and other airports under the control of the Bosnian authorities.

French Defense Ministry officials have repeatedly insisted that the United States helped facilitate a series of mysterious flights to Tuzla during the war by American C-130 cargo planes, which were witnessed by U.N. observers. U.S. officials have denied any involvement in organizing the flights and have suggested that Turkey may have been responsible.

In an interview earlier this week, the former European Union negotiator to Bosnia, David Owen, said he shared the British and French view that the Americans had been involved in a covert arms program to Bosnia and Croatia during the war, but could not prove that this was the case.

If the Saudi version of events is accurate, the Clinton administration took care to preserve the principle of plausible deniability in the Bosnia arms effort through the use of former military and intelligence personnel and trusted middlemen. Saudi sources said that such informal American involvement was essential because Saudi Arabia lacked the "technical sophistication" to mount the operation by itself.

"The covert operation in Bosnia was much easier than in Afghanistan. In Afghanistan, the people who did the dirty work stood out a mile because of their blond hair and blue eyes. We didn't have this problem in Bosnia," said the Saudi official, referring to the physiological similarities between Bosnians and Americans.

The official refused to go into detail about the American role in the operation, other than to say that the Saudis had made use of the same "network" of undercover operatives, arms salesmen, and "former this and former that" set up during the Afghan operation.

"We did not set up a formal structure, the way we did in Afghanistan," the official said. "But logic tells you that without the consent of NATO, the United States and Germany, there was no way {the arms-smuggling operation} could have happened."

The Saudi official said that senior Clinton administration figures were driven by a sense of "Christian guilt feeling" over the need to do something to halt the atrocities that were taking place in Bosnia. He said that some senior officials in Washington were "almost in a state of depression" over their inability to bring the war to an end through diplomatic efforts.

Saudi efforts to persuade the United States to play a more decisive role in Bosnia went back to the final months of the Bush administration, according to Saudi sources. In June 1992, according to the sources, King Fahd sent a handwritten letter to President Bush, appealing to the United States to lead international efforts to "put an end to the massacres to which the Muslim population . . . is subjected."

Bush's national security adviser, Brent Scowcroft, said he had "no recollection" of the Saudi message. According to the Saudi sources, the king received a polite brushoff, which they described as the only major difference between Riyadh and Washington during the Bush administration.

The Saudi sources said their government began looking for ways of assisting the Bosnian Muslims partly to counteract the ability of radical states such as Iran to exploit the issue. They said Riyadh could not afford to be viewed as "less Muslim" over Bosnia than the radicals. The Saudis were so desperate to help the Bosnians that they were even prepared to see large quantities of arms diverted to Croatia.

According to the Saudi account, much of the Saudi assistance was given in the form of direct financial aid to the Bosnian government. The Bosnian Muslims then used the money to purchase weapons on the black market at grossly inflated prices. The Bosnians were able to purchase many weapons, including some tanks, from their Serb enemies.

The Saudi assistance also took the form of shipments of ammunition, small weapons, military uniforms and even some artillery pieces captured from Iraq during the 1991 Persian Gulf War.

The Saudi sources said that many of the supplies came in by sea, despite a NATO blockade of the Adriatic Coast. The United States was officially committed to enforcing the arms blockade until November 1994, when the Senate cut off funding for the U.N. anti-smuggling operation.

U.S. officials say that they have asked Saudi Arabia and a number of other moderate Islamic countries to contribute to a new program to equip and train the Bosnian armed forces.

The Saudi official estimated the initial cost of the program at $100 million to $200 million. He said that he expected other moderate Islamic states, including Brunei, to contribute to the fund.

A U.S. official involved in the equip-and-train program said that the Clinton administration has still not been informed officially of the Saudi response. He described the reported Saudi readiness to contribute as "great news." CAPTION: DAVID OWEN