Doc coastal ranger Jim Fyfe said the large adult male was in bushes near the entrance to the Dunedin-Ravensbourne cycleway in Magnet St yesterday, surprising unsuspecting track users as they passed.
No-one had been injured by the sea lion, but Mr Fyfe said there was a danger people may get a fright and fall over, sprain an ankle or fall off their bicycle.
Signs were now being put up in the area to warn track users.
Dunedin residents should expect to see more sea lions in unusual places around Otago Harbour because of the large number of octopuses in the water, Mr Fyfe said.
"Octopuses are semelparous.
"They live for two years, then they put all their energy into breeding, and then they die straight after.
"Large numbers of octopuses are dying in the harbour at the moment because of this, and the sea lions are probably cashing in on it."
The sea lions were harmless, as long as residents gave them a wide berth.
They hauled themselves out of the water to rest and usually disappeared again after a day.
