Thirteen "Unlearn criminal" billboards appeared at train stations across Sydney depicting a young woman of colour gripping a fence with the words written over the top.

According to a complainant, the billboard was offensive "particularly given the over representation of Aboriginal and Torres Strait Islander women in our prison system".

"These women make up around 34 per cent of the female prison population but only two per cent of the adult female population," the complainant said.

The billboard is part of the university's "Unlearn" campaign. Targeted at prospective students, it features a series of ads that list different lessons students can "unlearn", such as "love", "medicine", and "threat".

The university argued its campaign promoted the "critical thinking skills" that allow students "to question established beliefs and to think critically in order to foster a positive change in the world".

The image, sourced from the United Nations Refugee Agency, was "intended to provoke thought regarding the way society treats children in detention".

"If anything, [the billboard] encourages the very opposite [of racial discrimination or vilification] - it advocates an open approach to controversial subject matter that is non-discriminatory and open-minded," the university said.

But Madeline Ward, co-convenor of the University of Sydney's Autonomous Collective Against Racism, said the university's use of the image in its campaign was also offensive.

"Aside from the obvious racism of the advertisement, I find it disgusting that the university would use the struggle of refugees and those detained in offshore detention as an advertising strategy," she told the Herald.

The Advertising Standards Board found the advertisement violates the Australian Association of National Advertisers code of ethics by creating the overall impression that "non-Caucasian people are criminals".

"The board considered that the meaning of the word 'unlearn' is ambiguous and that the concept of the campaign is quite complex," it wrote in its judgement.

"In the medium of an outdoor advertisement, [the ad] would be likely to be often seen in quite a fleeting manner is ... more likely to be taken as representing a stereotype of non-Caucasian young people being held in gaol or other form of detention."

While the university has removed and discontinued the Unlearn criminal ad, it is appealing the board's decision.