In 1780, during the Revolutionary war, General George Washington directed that the regiments of the New Jersey Continental Line have a flag of dark blue and buff. He presumably selected these colors for historic reasons - New York and New Jersey were both originally settled by the Dutch - dark blue (Jersey blue) and buff were Holland's (the Netherlands) insignia. The center of the flag features the great seal of New Jersey.

Symbols on the state seal: the three plows on the shield honor the state's agricultural tradition. The helmet above the shield faces forward, an attitude denoting sovereignty and thus particularly fitting for one of the first governments created under the notion that the state itself is the sovereign. The crest above the helmet is a horse's head (the horse is also New Jersey's official state animal).

The supporting female figures are Liberty and Ceres (Roman goddess of grain - a symbol of abundance). Liberty carries the liberty cap on her staff and Ceres holds a cornucopia filled with harvested produce.

New Jersey's seal was originally designed by Pierre Eugene du Simitiere in 1777 and has had only minor changes made since then.

Liberty originally held her staff in the crook of her arm rather than her right hand. The female figures now face straight ahead but once looked away from the shield. The cornucopia that Ceres holds upright was once inverted, its open end upon the ground. In 1928 the year of statehood (1776) first appeared in Arabic figures.

Source:

The New Jersey State Flag: Official New Jersey website

Links:

State Flags - 50 states List
National Flag