The papacy of John Paul I began yesterday with a colorful service before a quarter of a million people in St. Peter's Square that, despite its pomp and ceremony, was the simplest installation of a pope in hundreds of years.

Kings and premiers, presidents and representatives of other religions joined the hundreds of thousands that came to view a ritual that the new pontiff termed a mass "for the beginning of a ministry as supreme pastor" rather than the traditional papal coronation.

In his homily, the new pope called for a climate of "justice, brotherhood, . . . and hope."

For hours before the installation ceremony, police and demonstrators clashed at several locations in Rome and the Vatican. Most of the protests were directed at official delegations from right-wing South American governments.

As the service began, part of the force of 10,000 police guarding the city against possible terrorist attacks removed a group of demonstrators from St. Peter's Square. The group, protesting the presence of Argentine President Jorge Videla, had unfurled a banner reading "Videla - Murderer." In all, police reported about 140 arrests throughout the city. There were no reports of injuries.

Although Italy had been the scene of major terrorist attacks in recent months, yesterday's scattered protests were the first significant disturbances in the four weeks of ceremonial gatherings that have followed the death of Pope Paul VI on Aug. 6.

The installation came just eight days after the cardinals of the Roman Catholic church elected Venice's Albino Cardinal Luciani, now John Paul, as the new pope.

Since his election in one of the shortest conclaves in history, the smiling, gray-haired pontiff has made it clear that he plans to do away with much of the formality that traditionally has surrounded the spiritual leader of the world's 600 million Roman Catholics.

The ceremony was conducted outdoors, in front of a simple, makeshift altar. It was the first in over a thousand years to do away with the triple crown, or papal tiara, and the traditional canopy over the pontiff's throne.

The only traditional coronation-day vestments worn by the new pope were the tall, jewel-encrusted papal hat, or miter, and the pallium - a two-inch-wide strip of white wool decorated with purple crosses and worn around the neck. The pallium is the symbol of a pope's authority over the church.

These changes, along with John Paul's decision to abolish the portable papal throne and the traditional papal procession, made the ceremony a stark contrast to Pope Paul's elaborate 1963 coronation and those that preceded it.

Nevertheless, the massive crowd of Roman Catholic worshipers appeared awed as a procession of 120 chanting white-robed cardinals preceded Pope John Paul out of St. Peter's Basilica where, moments before, he had prayed at the underground tomb of St. Peter, the apostle and the first pope.

As the new pontiff appeared, dressed in white and carrying a crosier, the cross-topped staff that symbolizes his pastoral function, the crowd broke into enthusiastic applause. The short, bespectacled pope then took his seat on a simple throne at the top of the basilica's marble stairs, facing, the altar several yards away.

The pope then received the pallium from Pericle Cardinal Felici, dean of the cardinal deacons, who had himself been considered a possible successor to Pope Paul.

After the pallium was placed on the pope's shoulders, the 120 cardinals present approached his throne, one by one to kneel and exchange the "kiss of peace" with the new holy father. As dusk turned to dark, the choir chanted "You Are Peter." John Paul greeted each of the cardinals with a smile, a few whispered words, and a warm embrace.

On the pope's left sat several hundreds foreign dignitaries including Vice President Mondale and his wife Joan, King Juan Carlos and Queen Sophia of Spain, King Baudouin and Queen Fabiola of Belgium, Prince Rainier and Princess Grace of Montercarlo, Canadian Prime Minister Pierre Trudeau, West German Chancellor Helmut Schmidt and French Prime Minister Raymond Barre.

The communist countries, with which the church has conducted a 15-year dialogue, were represented by delegations from Cuba, Poland, Yugoslavia, East Germany, Hungary and Czechoslovakia. The Soviet Union was represented only by the charge d'affaires of its embassy here in Rome but there were unconfirmed reports that the new pope has received a telegram from Soviet leader Leonid Brezhnev.

Another block of chairs on the pope's right was reserved for black-garbed clerics, purple-robed bishops and representatives of 17 non-Catholic Christian churches. Here, too, sat about 40 of the pope's relatives.

Among the more than 1,000 visitors from the pope's home region of Venetia were the socialist mayor of Venice where John Paul was archbishop, and the Communist mayor of his hometown of Canale d'Agodo.

"The new pope, in a homily, expressed the hope that under his reign the Holy See and the church would be able "to help create a climate of justice, brotherhood solidarity and hope, without which the world would be unable to live."

He referred to "all the people in the world. We regard them and love them as our brothers and sisters, since they are the children of the same heavenly father and brothers and sisters in Chirst Jesus."

John Paul, 65, began his homily in Latin and finished it in Italian, saying he had received his election "with surprised and understandable trepidation" and would interpret this role as one of accepting the yoke that Christ has wished to place on "our fragile shoulders."

As the mass continued, the pope received communion from Cardinal Felici and then in turn gave communion to his relatives, some of whom has come from as far away as Canada and the United States.

Cheers rang out from the crowd and flashbulbs popped as the pope said the traditional "urbi and orbi" (city and the world) blessing to the city and to the world. Some people dropped to their knees and prayed. Many cheered and waved kerchiefs, showing that the former patriarch of Venice, in the week since his elevation, has captured the public imagination in a way that can only be compared to that of Pope John XXIII, Paul's predecessor and the other pope from whom the new pontiff drew his name.

The decision to do away with much of the splendor surrounding the papacy and to refuse to be crowned has been taken by many observers to signify John Paul's intention to reject the concept of temporal power, thereby reinforcing the decisins made at the Second Vatican Council in the early 1960s.