JettyLauncher is a pretty handy Eclipse plugin to run web app in Jetty. The bad news is it doesn't seem to work well with Log4j and uses the mortbay logging by default. The good news is the logging behavior can be controlled via some system properties:

  DEBUG - if set debugging is output is enabled.
  DEBUG_PATTERNS - A list of substring patterns used to match against log information for
                   fine grained control of debug logging.
  DEBUG_VERBOSE - If set to a positive integer, trace and info are enabled.
                  If set to zero, then info is enabled.

I found this out from the source code org.mortbay.log.LogImpl.java. Here is more info about logging in Jetty.