HARTFORD, Conn. (AP) _ A settlement will be entered Wednesday in a $125 million lawsuit by a woman who claimed state officials violated her civil rights by confining her 42 years to institutions even though there was proof she was not retarded.

The settlement was reached after Chief U.S. District Judge T. Emmet Clarie heard motions for summary judgment in May from attorneys for the state and plaintiff, 78-year-old Gladys Burr, the woman's lawyer said Tuesday.

A federal court clerk said the settlement would be read into the record Wednesday by U.S. Magistrate F. Owen Eagan.

The lawsuit, filed in 1979, claimed Miss Burr spent most of her adult life in state institutions for the retarded, but tests showed her IQ to be around 104.

From age 29 until she was 72, she was confined with retarded adults and performed manual labor for the state and a number of group homes to which she was ''paroled.'' She claims she was beaten, confined, fed bread and water and subjected to other cruelties at times during her confinement.

The suit charges her civil rights were violated and that she was subjected to slavery. It says she was deprived by the state of many basic and constitutional freedoms, including freedom of speech, association and travel and freedom from false imprisonment, intimidation and humiliation.

The suit also said she was denied her freedom to life, privacy and education.

Richard Altschuler, Miss Burr's attorney, declined to say Tuesday exactly how much the settlement called for since it had not been entered into the public record, but he said it was ''a lot higher'' than $150,000.

The state has defended what happened to Miss Burr by pointing to a state policy that allows people who are not retarded to be held if they do not ask for release or cannot adapt to life outside.