DECLARE @test INT
SET @test= 3  --char number from left in string to replace

DECLARE @newValue AS CHAR(1)
SET @newValue = 'X'  --new value for replaced text

DECLARE @inputText AS VARCHAR(10)
SET @inputText = 'ababababab'

SELECT  CAST(SUBSTRING(@inputText,0,@test) AS VARCHAR) + 
@newValue + CAST(SUBSTRING(@inputText,@test+1,LEN(@inputText) - @test) AS VARCHAR)   

--RESULT 'abXbababab'