A little known group held a conference yesterday to describe something that's rather unusual these days - an urban development project that worked.

The project is Brickyard Mall, a $50 million, 50-acre regional shopping center that was constructed in a middle-income residential neighborhood on the northwest side of Chicago, the first shopping area of its kind built in the city in 30 years. The first phase of the project opened in March and the entire complex, encompassing 1 million square feet, is expected to be completed in the fall of 1979.

But what is bringing joy to Chicago city officials, retailers and developers are statistics gathered over the last four months showing that up to 40 per cent of the shoppers are coming to the mall from the suburbs, a marked change in consumer movements.

"We're using a reverse domino theory," said E.N. Maisel, a Detroit-based developer who conceived the idea. "We're bringing money into the city, stabilizing the neighborhood and making it easier for people to keep their children here.

"When industry looks around, they'll say, "This is a good area. Let's locate here."

More than 100 retail stores are expected to located at the mall when it is completed. Maisel said he anticipates total annual sales of $200 million, which would bring $2 million a year into the city in sales tax revenue, along with another million dollars in property taxes. He estimated the project would create 5,500 construction jobs and 5,000 permanent full- or part-time retail jobs.

The project was approved by the late Mayor Richard J. Daley. His successor, Michael A. Bilandic, was at yesterday's conference here and described Brickyard Mall as a model for the kind of cooperation that is needed between government and the private sector for urban development projects.

That idea - a "partnership" between the public and private sector - was the main theme at the two-day conference, called by the National Council for Urban Economic Development. The council, headquartered in Washington, is a nonprofit, information and lobbying organization on behalf of cities.

Besides Brickyard Mall, the council also sponsored workshops on two other successful urban development projects. One involved Somerset Knitting Mills, Inc., a Philadelphia company and subsidiary of Philips-Van Heusen Corp., which made a $7.35 million decision to relocate in the city, rather than move to the suburbs or to another part of the country. That decision was eased by the cooperation of the Philadelphia Industrial Development Corp., a quasi-public development corporation for the city, which used federal money as incentive for Somerset to stay. PIDC arranged financial assistance and purchase of land for the new factory.

The third project discussed was the revitalization of the Strand, a five-by-two-block national historic landmark near downtown Galveston, Tex. A fund was established to preserve the area's deteriorating buildings, and, beginning with public grants and private donations, nearly $3 million was set aside to puchase and rehabilitate them. The area is now experiencing a commerical rebirth and is adding new tax revenues to the city.

But much of the day's excitement centered on the Brickyard Mall. The site, a former brick factory, had been an eyesore in the neighborhood for years. It had a hole in the ground the size of a square block and up to 100 feet deep and a pile of dirt 150 feet high.