Installation began on Monday and is to be completed on Tuesday.
The creatures are part of the United Buddy Bears exhibition, which officially opens on Wednesday. The aim is to collect money for Unicef and other child-welfare NGOs.
The two-metre-high bruins, who represent the member states of the United Nations, stand in a circle, paw-in-paw. Each of the 142 bears has been decorated by an artist from the country it represents.
They are to grace the square until the end of October, when they move on to Berlin.
The Finnish bear, decorated seven years ago by the Hamburg-based Mirka Raito, is to be auctioned at the end of the show. Then a new Finnish bear will be created by another artist, who is yet to be named. The German Embassy is coordinating the search for the next artist.
Launched by a pair of German artists, the show has been touring the world since 2002. In that time it has raised more than 1.6 million euros for charity.