A member of the public spotted the body of the man in the River Cam at Jesus Green at 0200 BST on Wednesday. A murder inquiry has begun.
Cambridgeshire Police said an 18-year-old man and a 17-year-old boy have been arrested on suspicion of murder.
A post mortem examination found the man died as a result of a sustained, attack and "immersion in water".
Police believe the time of death was between 0100 BST and 0130 BST on Wednesday.
"We arrested an 18-year-old man and a 17-year-old boy on suspicion of murder. Both remain in custody at Parkside Police Station," police said.
Det Ch Insp George Barr said: "We are keen to speak to anyone who was in the area on Tuesday night and the early hours of Wednesday morning and saw anybody acting suspiciously.
"Inquiries to trace the victim's next of kin are ongoing.
"However, we can say he had been living on the city's streets for several weeks."
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