A man has been arrested at Surry Hills over an alleged break and enter and aggravated indecent assault last week at a university accommodation facility in northern Sydney.

A 20-year-old was asleep in the Macquarie University dorm when a man broke in at around 3:20am on Thursday 21st February.

She claims the man indecently assaulted her while she was asleep.

Police arrested at 21-year-old Sri Lankan National at Railway Square in the CBD this morning.

They questioned 80 Sri Lankan asylum seekers after the incident, however the university said it was an open facility and the perpetrator could have been anyone.

The Federal Opposition said last week there are up to 10,000 asylum seekers waiting for approval to stay. It questions whether universities are the right place.

"That question about its appropriateness is not even asked by the Government," Shadow Immigration Minister Scott Morrison said.

There has been no confirmation whether the man arrested was one of the asylum seekers staying at the university.