They were celebrating the end of exam season with a blow-out named Hesstival, centred around Back Hessle View.
Bunting, a marquee and sound-system filled the street, which was blocked off with bins at either end.
The music was so loud that people watching a film at the nearby Hyde Park Picture house had to leave because they could not hear it.
A party also took place in a garden right outside the Leeds Makkah Mosque, disrupting Muslims who were praying inside for Eid al-Fitr, the end of the holy month of Ramadan.
Council noise officers were first called in the afternoon, but it was so loud they could not even speak properly to the organisers of the party.
Police visited throughout the afternoon and early evening, but the music kept being turned back up, so around 20 officers with two dog units attended and eventually brought the party to an end around 10pm. The dogs were not brought out of the vans.
One woman was arrested and charged with two counts of assaulting police officers.
Officers confiscated the sound-system and other equipment, telling students they would have to go to court to get it back.
Hyde Park and Headingley ward councillor Neil Walshaw said he was inundated with texts, calls and emails about the party.
He said he did not want to be 'councillor kill joy', but said there had to be some 'give and take'.
"These parties are getting out of hand. You just can't have that level of sound system in a residential area.
"It is not just residents that complain - I had a lot of complaints from other students. It's not a case of 'town versus gown'.
"I went down to see for myself around 10pm and it was starting to disperse."
Cllr Walshaw praised the response of Leeds City Council and West Yorkshire Police.
"They dealt with it really well, in a restrained way," he said.
One student, who did not want to be named, said it was 'mad disrespectful' to hold a party outside a mosque during Eid.
Cllr Walshaw said many families holding Eid parties dared not come out of their houses.
One man on Facebook said he was told by a person at the party near the mosque that it was 'completely legal until 11' and 'it's one day of the year, I don't get what your problem is'.
A West Yorkshire Police spokesman said: "From 4pm police started to receive calls from residents reporting a party involving up to 200 people and loud music in the street in Back Hessle View, Hyde Park, and a house in Hessle Place.
"Officers liaised with the council to serve a noise abatement notice to shut the party down but the event continued.
"A dispersal order was put in place shortly before 11pm and additional officers attended to disperse the crowd.
"A 23-year old woman was arrested and subsequently charged with two counts of assaulting police officers.
"She is due to appear at Leeds Magistrates Court on July 4.
"Officers from the local neighbourhood policing team remained on patrol in the area to reassure residents."