It's intended to be ironic.
In his preface to the second edition, Lermontov criticises the readers who - like you - took the title at face value and interpreted it to mean Pechorin was really being modelled as a hero:
The preface to a book serves the double purpose of prologue and epilogue. It affords the author an opportunity of explaining the object of the work, or of vindicating himself and replying to his critics. As a rule, however, the reader is concerned neither with the moral purpose of the book nor with the attacks of the Reviewers, and so the preface remains unread. Nevertheless, this is a pity, especially with us Russians! The public of this country is so youthful, not to say simple-minded, that it cannot understand the meaning of a fable unless the moral is set forth at the end. Unable to see a joke, insensible to irony, it has, in a word, been badly brought up. It has not yet learned that in a decent book, as in decent society, open invective can have no place; that our present-day civilisation has invented a keener weapon, none the less deadly for being almost invisible, which, under the cloak of flattery, strikes with sure and irresistible effect. The Russian public is like a simple-minded person from the country who, chancing to overhear a conversation between two diplomatists belonging to hostile courts, comes away with the conviction that each of them has been deceiving his Government in the interest of a most affectionate private friendship.
The unfortunate effects of an over-literal acceptation of words by certain readers and even reviewers have recently been manifested in regard to the present book. Many of its readers have been dreadfully, and in all seriousness, shocked to find such an immoral man as Pechorin set before them as an example. Others have observed, with much acumen, that the author has painted his own portrait and those of his acquaintances! . . . What a stale and wretched jest! But Russia, it appears, has been constituted in such a way that absurdities of this kind will never be eradicated. It is doubtful whether, in this country, the most ethereal of fairy-tales would escape the reproach of attempting offensive personalities.
Pechorin, gentlemen, is in fact a portrait, but not of one man only: he is a composite portrait, made up of all the vices which flourish, full-grown, amongst the present generation. You will tell me, as you have told me before, that no man can be so bad as this; and my reply will be: "If you believe that such persons as the villains of tragedy and romance could exist in real life, why can you not believe in the reality of Pechorin? If you admire fictions much more terrible and monstrous, why is it that this character, even if regarded merely as a creature of the imagination, cannot obtain quarter at your hands? Is it not because there is more truth in it than may be altogether palatable to
you?"
You will say that the cause of morality gains nothing by this book. I beg your pardon. People have been surfeited with sweetmeats and their digestion has been ruined: bitter medicines, sharp truths, are therefore necessary. This must not, however, be taken to mean that the author has ever proudly dreamed of becoming a reformer of human vices. Heaven keep him from such impertinence! He has simply found it entertaining to depict a man, such as he considers to be typical of the present day and such as he has often met in real life -- too often, indeed, unfortunately both for the author himself and for you. Suffice it that the disease has been pointed out: how it is to be cured -- God alone knows!
-- translated by J. H. Wisdom and M. Murray (PDF available here, original Russian version here); emphasis mine
It seems that, as I already guessed without knowing anything about the book, the title is a cynical reflection on the contemporary world. Lermontov is saying that a "hero" of our time is not really a hero but something of a jerk. But being unable to say so openly, he resorted to ironic ambiguity in order to make his point.
It's also interesting to note that in the original Russian title Герой нашего времени, the word "Герой", while usually taken to mean "hero", can also mean "character". This was perhaps a deliberate choice of words on Lermontov's part, to further increase the ambiguity of the title.
