WASHINGTON (AP) _ Former Attorney General Edwin Meese announced Friday he will give up a court battle to suppress the Iran-Contra prosecutor's final report, which accuses Meese of covering up President Reagan's knowledge of an arms-for- hostages deal with Iran.

Calling the conclusions by independent counsel Lawrence Walsh ''outrageous,'' Meese said through his lawyer that he will ''confront Walsh's false statements head on'' when the report is released.

A special three-judge panel of the U.S. Circuit Court of Appeals in Washington D.C. could release the report on Tuesday, unless other Iran-Contra figures seek Supreme Court review.

Meese joined ex-President Reagan in ending their court battle to block public release of the Iran-Contra prosecutor's work.

But former White House aide Oliver North also has been seeking to withhold the report from the public. And North's lawyer, Nicole Seligman, would not say whether North is seeking Supreme Court review.

Walsh finished the report in August and submitted it to the appeals court panel, which gave people named in it four months to respond.

The special court last week denied requests to withhold all or most of the report, while declaring that it is ''rife with accusations of guilt of criminal conduct'' against people never indicted or convicted.

The appeals court did not identify who filed the requests, but sources close to Walsh's seven-year criminal probe identified them as Reagan, Meese and North.

''Once Walsh's report is made public,'' Meese's lawyers will address ''both the report's outrageous content and the irresponsible conduct of Lawrence Walsh,'' said Mark Levin of the Landmark Legal Foundation, a conservative public interest law firm representing Meese.

''It will be clear to the American people that the attorney general acted properly and responsibly in every aspect of this matter,'' Levin added.

The Walsh report concludes that Meese concocted a false account of a November 1985 arms-for-hostages shipment to Iran by saying Reagan hadn't known about it, according to other sources close to the probe who have read portions of the Walsh document.

Both sets of sources spoke on condition of anonymity.

On Thursday, Reagan lawyer Theodore Olson said the former president's conduct in Iran-Contra ''was above reproach'' and that he would not seek Supreme Court review.