Up to 1000 students at the University of Sydney are in limbo after their final exam was abruptly cancelled on Friday morning due to fears the exam had been compromised.

Commerce students sitting their final exam for the compulsory business insights unit had just begun reading the exam paper when they were interrupted by an announcement from the examiner, a student told Fairfax Media.

Up to 1000 commerce students had their exam cancelled on Friday morning, due to fears it had been compromised. Credit:Fiona-Lee Quimby

The decision was made after faculty staff learnt of a "potential breach in the security of the exam script", according to an email sent to students on Friday afternoon.

"We went into the exam and sat down," the student, who asked to remain anonymous, said.