IN ITS look, feel and function as a public

place, Journal Square in Jersey City

resembles New York's fabled Times Square.

Like its famous counterpart, the cluttered ring of shops, theaters and mass-transit facilities along Kennedy Boulevard has fallen on hard times. But also like Times Square, it is about to undergo a dramatic redevelopment that city officials and private developers believe will restore much of its sparkle and bring it back into prominence as a commercial hub of northern New Jersey.

While New York's $1.6 billion Times Square Redevelopment Project is being overseen by a state agency in cooperation with the city, Journal Square's rejuvenation is a market-spurred undertaking proceeding with assistance from the city but without any outright government control.

Capitalizing on the growing interest in Jersey City, with its cheaper rents and mass- transit facilities, private developers have already built two new office buildings and rehabilitated a third, and are planning several other developments that could add more than a million square feet of new and thoroughly renovated office space to Journal Square over the next few years.

In addition, private developers have already transformed several derelict apartment buildings in the immediate area into upscale residential condominiums.

''Development in Journal Square is no longer something just for pioneers,'' said Thomas J. Leane, executive director of Jersey City's Redevelopment Agency. ''Now we're seeing actual fulfillment of plans.''

The developers who have already invested their time and money in Journal Square, many of them residents of Jersey City, express great enthusiasm for the area's future.

''Journal Square really is going to fly in a year,'' said Joseph A. Panapinto, a Jersey City lawyer whose four-story, 50,000-square- foot office building on Kennedy Boulevard was considered a key factor in inspiring Journal Square's renaissance.

Completed in April and already fully leased, the building stands on four acres at the northern end of Journal Square known as the ''bowl'' because it borders the deep railroad cut through which the PATH trains pass. City officials and private developers had been trying unsuccessfully to develop the site for more than 25 years.

Mr. Panapinto, who went to school in Jersey City and still lives there, has watched Journal Square change from a strictly local, somewhat down-at-the-heels business area into a promising new retail and office market that boasts a number of distinct advantages, primarily the PATH line, which connects Jersey City with Wall Street in about 15 minutes.

The completion of the PATH stop in 1908 established the area as a transportation hub and supplied the original impetus for the area's commercial development. The present Journal Square PATH train terminal and the 10-story office building above it were built in 1974. In addition, there are about 35 different bus lines that run use the terminal, making Journal Square a prime transportation hub for the region.

Mr. Panapinto's success in leasing the first building at an average $20 a square foot has encouraged him to proceed with a second project at the site - a 15-story, 450,000- square-foot office building with a 1,000-car parking deck. He plans to go before Jersey City officials with the project next month.

Other official developments have popped up throughout Journal Square recently. At the corner of Tonnelle Avenue and Kennedy Boulevard, A.I.D. Equity constructed a three-story, 50,000-square-foot office building with retail space in the ground floor. At the other end of the square, L. Robert Lieb rehabilitated the 15-story, 115,000-square-foot office building at 26 Journal Square.

The 56-year-old building, which was originally constructed as the first bank sponsored in the United States by the labor movement, is listed on the state Register of Historic Places. Half of it has been leased, with a number of new tenants, including the International Organization of Masters, Mates and Pilots, transferring from New York. Rents have averaged $16.50 a square foot, according to Mr. Lieb.