Civic Architects' and landscape architect Colour: Urban Design Limited's entry has been chosen for the redevelopment of the space, as part of a competition to redesign six public squares in Lancashire.
The winning entry proposes creating terraces of different sizes that can be used for seating or large events such as Burnley's annual jazz festival.
Colour: Urban Design Limited associate Jon Eachus has been leading the project and said he expected to develop the soft landscaping design through collaboration with staff from the Green Spaces & Amenities Unit at Burnley Borough Council.
Chairman of the judging panel and Stirling Prize-winning architect Stephen Hodder said: "The scheme responds to the particular character of the site and as such it will be unique and belong to Burnley."
The Landscape Institute is running the competition with regeneration agency Elevate.
Manchester-based Landscape Projects has already been chosen to design a square in Accrington, Lancashire, and winners from the four other Pennine Lancashire towns - Blackburn, Bacup, Clitheroe and Nelson - are now being selected.