Construction on Rte. 123 in Fairfax City will begin in March, part of a $258,000 program designed to reduce traffic congestion on the main north-south thoroughfare without destroying the city's residential nature.

The City Council last week approved a down-scaled project to be paid for entirely by the city, instead of a more elaborate project that would involve state and city funds. The approved plan calls for:

Construction of left turn lanes on Rte. 123 at Jones Street, West Drive and the entrance to Commonwealth Hospital.

Installation of "no left turn" signs on Rte. 123 at Stratford Avenue and Warwick Avenue.

Paving over urban ditches along Rte. 123.

Construction of an asphalt sidewalk east of Rte. 123 from Rte. 50 to Center Street and west of Rte. 123 from Jones Street to School Street.

"This program provides for anticipated growth over the next five years, but at the same time it still keeps the residential character of the city," said Tom Welle, information director for the city.

The council rejected another proposal that called for widening Rte. 123 to three lanes from the courthouse to the south end of the city. The plan would have cost $1.3 million and required assistance from the Virginia Department of Highways and Transportation, Welle said.

The council already has appropriated $100,000 this fiscal year for improvements to Rte. 123, so construction can begin in March, with a March 1983 completion date, Welle said.