The Science and Technology Select Committee, chaired by Oxford West and Abingdon MP Nicola Blackwood, conducted proceedings in the Divinity School at the Bodleian Library.
It is the first time that the committee has met outside London, and is part of the commemorations to mark 750 years since the birth of Parliament.
Parliament last met in Oxford in 1681.
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The committee continued its inquiry into the lessons the UK can learn from the Ebola epidemic.
It was joined by about 80 sixth form students, taking part in Oxfordshire County Council's Find Your Voice project, which gives young people the chance to debate with politicians.
The Commons met in the University of Oxford's Divinity School in 1625 to avoid the plague in London.
Parliament met in the Divinity School in 1644, when Charles I brought his Court to Oxford during the Civil War.
The Lords and the Commons met in Oxford in 1665 in the Geometry School and Convocation House respectively.
Parliament met in the Divinity School in 1681, the last Parliament of King Charles II's reign.
Source: University of Oxford
Nick Rawlins, the pro-vice-chancellor of the university, called the sitting an "exceptional occasion".
Miss Blackwood said it was important for the committee to "get out of the bounds of Parliament".
She added: "I'm pleased to be in my home city of Oxford to chair this special session... and it is inspiring to be in the Divinity School which has an historic link with Parliament."
Lorraine Lindsay Gale, the council's cabinet member for cultural and community services, called the sitting "very significant".
"It will encourage young people to understand how Parliament and democracy works," she added.
The first Parliamentary sitting in Oxford for more than 300 years has taken place.