Al Jazeera correspondent Mike Hanna said the fighting "started with an argument and then got physical".
Dozens of men wearing construction helmets and carrying makeshift weapons - chair legs, pipes, garden tools, sticks and chains - converged on the university and fought with police.
University cordoned off
Troops fired into the air to try to break up the crowds and cordoned off the neighbourhood. Military lorries were used to evacuate the streets of civilians trapped by the violence.
Followers of the Future Movement led by Saad al-Hariri, the anti-Syrian parliamentary majority leader, and opposition supporters of the Shia Hezbollah movement and its ally Amal, were said to have been involved in the clashes.
Television stations run by both camps blamed each other for the violence.
Fouad Siniora, the prime minister, appealed to the Lebanese to "avoid tension and escalation".
"I call on everyone to return to the voice of reason," he said.
Call for calm
Hezbollah issued a statement urging its supporters to leave the streets around the university and respect the curfew.
"We are using a fatwa [religious decree] ... in the interests of the country and civil peace ... everyone should evacuate the streets, remain calm and leave the stage for the Lebanese army and security forces," it said.
Nabih Berri, the parliamentary speaker and leader of Amal, told several Lebanese television stations: "What everyone should do now is halt the strife.
The Lebanese army fired shots into the air
to disperse the students [AFP]
"I call upon you once again to channel all your powers towards reconciliation ... towards national unity."
Al-Hariri urged his followers to "remain calm and not respond to provocation".
The fighting followed widespread unrest in the country this week when the opposition staged a general strike and subsequent fighting left at least six people dead and scores injured.
The opposition is seeking veto power in government and early parliamentary elections to topple the Siniora's cabinet.
Siniora and al-Hariri have refused to accept the demands.
Al Jazeera's correspondent reported that the fighting erupted after the armed men obstructed the troops' deployment in the area.
Soldiers opened fire after the armed men threw stones. Witnesses said three people were injured.
The violence came as Siniora won pledges of more than $7bn in aid at a donors' conference in Paris to help rebuild Lebanon after the war between Israel and Hezbollah last summer.