At least seven students were hurt in Wednesday's clashes seen as the worst political disturbance in the area since the end of Sri Lanka's civil war in 2009.
A statement from the U.S. Embassy in Colombo said "it is greatly concerned about reports of attacks on students in Jaffna. We call upon authorities to exercise restraint and respect peaceful demonstration."
The clash erupted as the students were protesting a search of their university a day earlier by army troops and police in the northern district of Jaffna, a former war zone which is the cultural heartland of minority Tamils. Police denied anyone was hurt.
A local journalist said troops and police searched the university for pro-rebel propaganda on Tuesday after students reportedly tried to honor rebels who died in the civil war.
During the nearly three-decade-long civil war, the Tamil Tigers used to commemorate their fallen comrades on Nov. 27, a day after their leader's birthday.
E. Saravanapavan, a Tamil lawmaker from Jaffna, accused the troops and police of triggering the clash by searching the university and later attacking the students' demonstration.
Military spokesman Brig. Ruwan Wanigasooriya denied any army involvement in the search and clash. He said the "army has been maintaining a very cordial relationship with people of Jaffna and we will continue that relationship in spite of attempts by some people to disrupt it."
Saravanapavan said the army should stay in its barracks, adding the "army need not be there as the normalcy has returned. Let the police handle the work and ensure law and order."
He called for greater demilitarization of the northern region.
Since the war's end, the government has maintained a heavy military presence in the north despite international calls for a reduction of troops there. International human rights groups and countries including U.S. have urged Sri Lanka to demilitarize the north.
Sri Lanka has rejected those calls, saying such a move would undermine national security.
The civil war ended after the government troops defeated the Tamil Tiger rebels who were fighting for a separate state for Tamils in the country's north and east.
Both the government forces and rebels have been accused of serious human rights violations during the conflict.