Stay away from Times Square on New Year's Eve. Sorry to disappoint you but it's so not worth it anymore and that started 1999 to 2000. Before that you could walk right through Times Square at any hour, even at 11:50pm and find a spot to watch the ball drop. For some reason security was strengthened with the 1999-2000 celebration. That's when they started to put people in pens to control the crowds. After 9/11, security was once again heightened. To get in a pen you have to get to Time Square at least 6 hours ahead of time. And make sure you don't have to pee, because if you leave the pen, you cannot get back in. And once in the pen, you're there for 6+ hours in all the elements and weather from rain to snow to sleet with no umbrellas or backpacks. It's just you and the clothes you're wearing.
It's best to just watch it on TV or if you really want to be in the city for New Year's Eve, go to another part of town which will be much more fun. As a general rule, us native New Yorkers try to avoid Times Square year-round.