The clip, which has been shared online, shows students packed into a room at the residential halls, Arundel House, near the main campus.
Students can be seen ignoring social distancing rules and without face masks as they sing a long to music, dance and a climb on top of what appears to be a ping pong table.
The clip shows the crowd breaching the Government’s rule of six, which was introduced earlier this month in a bid to curb the spread of coronavirus.
It comes as around 4,000 students across the UK are now self-isolating after more than 500 cases were confirmed across at least 32 universities.
Coventry University said it was aware of the incident, saying that any student found to be in breach of regulations could face disciplinary proceedings.
The university has launched an investigation into whether the party was planned and who organised it.
Business Secretary Alok Sharma, when asked about a video which apparently shows a group of university students having a party, said the Government was asking students to “follow the rules, follow the guidance, and act responsibly”.
“This has been actually a very, very difficult time for young people and actually, they want to get back to some sense of normality, we can’t just sort of lock people down forever,” he told BBC Breakfast.
“Universities are open, students have gone back, and of course we ask them, just as we ask the rest of the population, to follow the rules, follow the guidance, and act responsibly, and ultimately this is for their own good, and I hope people will do that.”
Asked about students going home at Christmas, Mr Sharma said: “I know that was a concern and a worry over the last few days, whether parents would miss out on spending time with their children and vice versa, so we’ve given that commitment.
“He (Education Secretary Gavin Williamson) is looking to see precisely how we will make this possible.
“But as I said, we want students to have a sense of normality, to be able to enjoy the teaching that they have at universities, and of course ultimately to also keep safe.”
A spokesperson for Coventry University said: “We are aware of an incident in a private accommodation block which was captured in a video that has been shared online.
“We are deeply concerned by the scenes in the video and strongly condemn the blatant breaches of the rule of six and other guidelines as they risk the health of our students, colleagues and the communities in which we are located.
“We have introduced a code of conduct for students and shared this widely with them ahead of the weekend. This code of conduct makes it clear that a failure to follow university and Government health, safety and wellbeing requirements will constitute a breach of the university’s disciplinary regulations and may be dealt with as a matter of misconduct.
“If any of those involved in the video are found to be students of Coventry University and in breach of the code of conduct, we will take appropriate action.
“The vast majority of our students are sensible adults and are taking coronavirus very seriously. Many of them are from the communities in which our campuses are based and want to protect themselves, their friends and loved ones.
“Hundreds of our students on health courses worked in NHS wards and ambulances during the peak of the pandemic.
“Across our five campuses, we have put in place safety measures in line with government advice and we are in constant dialogue with local public health officials and other agencies and universities.
“We are regularly messaging our colleagues and students to reinforce the importance of following all the rules and laws designed to help prevent the spread of Covid-19 and we have student ambassadors in key places on campus to remind those who forget to comply with social distancing or face coverings.
“We are also actively encouraging the use of the NHS Covid-19 app to assist our existing track and trace process.”