To Override the Symbology of a Terrain Model

Attach as a reference the DGN file containing the terrain model.
Select the terrain element.
Select the Properties tool ( Drawing > Home > Primary > Properties ).

The Properties dialog opens.
On the Reference tab set the Override Symbology property to Yes.
Do one of the following:

Change other display properties as needed.

or
Select an element template to apply to the terrain model.

The display of the terrain model changes in your DGN file, but not in the original DGN file.