I would remove the upper part all together along with the lower tiles. Then I would frame it like one stone covered firplace going straight up to the ceiling on all sides with a nice large timber mantle above the firebox.

Mary, we are renting so have to work with what we have.

Then, perhaps you can hang a tapestry or small rug hung like a tapestry across the open so that the bottom touches the shelf.

Remove the upper area. Make a false book case that appears to be straight vs the V shape and top the mantle. Reface the fireplace surrounding with tiles. Add a large faux mantle. This can all be done cheaply. The hard work is chipping out the stone above the fireplace. When you look at the space, divide it in 3rds, ie, fireplace, shelf for TV then bookshelves. Paint bookshelf with a med gloss.

You can get very inexpensive tiles at Home Depot.

I would purchase a ready made mantel, with sides or without from one of the big box home improvement stores. The top of the mantel should line up with the top of the tile. It could be painted or stained, maybe the colour of your trim.
Now find a picture or print that works with your room, ensuring that the size will cover the entire hole above the fireplace. Hang it up and call it a day. Put your tv on the side as you suggested

Great ideas, thank you! We currently have a dk brown sofa and loveseat. Can this work with the gray walls & floor? Also, can you give me ideas for furniture placement and other decor? Should my coffee table match the wood in the trim? I am severely decor challenged. Thanks!

to help with furniture placement, we need to see photos of all the walls and the size of the room

If you are renting, use what you have and buy what you like. You won't rent forever. Your style will show through, no matter what the rental looks like. Play with your furniture till you like the arrangement. I am decorator challenged also. It gets very frustrating. I just want someone to tell me what I like and that it won't cost an arm and a leg. I have broken down and bought items that my daughters thought would work for me. I get them home and I just don't like them. I end up giving them to her. So, be eclectic. If you like it, it works!

Here are some pics, 1st one is to right of fireplace, 2nd is to left of fireplace, 3rd is directly across from first pic, 4th is directly across from second pic. The room is approx. 15'15'.

backbonemountain - my problem is I like a lot of different things but have no clue how to put them together so I don't do anything and end up using old stuff that I don't really care for. I'm wanting to buy some new things but not sure if I should start with the big stuff or smaller stuff.

I think you placement is probably right, and yes the tv to the right of the fireplace which would allow them both to be viewed
I think the main problem is scale and weight.

the wing chair is too large for the table beside it, switch the two chairs

the couch and love seat are large dark and appear to be on the low side. the end table in between them is not bad for size but too tall for the couches. The lamp on top of the end table is too small for both the table and the couches. Then the clock is too high and too small for the wall.

Do you have any other tables or lamps that could be used in this room

That is very helpful...thank you!! I don't have others yet but am going to get some things. I wanted advice before I bought anything. What I using now is a mixture of random furniture that we've acquired over the years. Do you have suggestions for tables & lamps?

are you keeping the couch, love seat and chair

No, not necessarily...

you space is well suited for L shaped placement

if you keep the loveseat and couch, make sure the couch is on the longest wall

choose an end table that is square and as deep or close to the size of the arm on your couch

the height of the end table should be just below the height of the arms on your couch

use the same set up as before, placing the table in the corner with couch and loveseat on either side

now choose a lamp with a much larger base and shade, as this lamp services both couch and love seat

the bottom of the shade should fall just below eye level

if space permits, pick up a matching coffee table

add some colorful pillows and a nice throw

find a large picture to go behind your couch or better yet find five medium pics or canvases that work together and place 3 behind the couch and two behind the love seat, all spaced out evenly and at the same height

if you wish to buy new the set up would be the same or you could opt for a L shaped sectional in the same area

Awesome! This helps me a lot!! Would you suggest matching the coffee and end table to the trim or something with color...and light or dark?

If you really love the trim color then yes you could match it. I appears to be a honey pine color. If you do
try to also pick up the honey color in your pillows, not solid honey color but a mixture of colors.

If you don't like the honey pine you go with a black, bronze or silver gray metal framed tables with glass tops. The wooden tables would be more country or traditional and the metal ones a little more modern, Which would suit your style more or which style suits the rest of your home

I cozy, rustic and unique things. I also have a house full of boys so glass scares me a little. I like the honey pine but I'm not in love with it. Would black or white or another color work?

Yes, both could work, but a lot would depend on your paint choices. Since your couch, loveseat and curtains are dark maybe off white or charcoal would be better than black.

What color do you have in mind for paint

I'm not planning to paint right now. The walls are carpet are both gray.

that will go nice than with your brown furniture. On my screen your carpet looks beige and the walls look like a bright blue maybe its my eyes falling asleep. got to get to bed

Thank you so much for your help! I feel like I can go shopping now with a goal. I truly appreciate it. Good night!