A police officer happened to come by the scene shortly before 2:30 a.m. and made the arrests, Berks County District Attorney Mark Baldwin said.
Quinn "had been beaten and was lying in a pool of blood," Baldwin told reporters.
Quinn was pronounced dead at Lehigh Valley Hospital in Allentown at 3:36 a.m. An autopsy was scheduled for today.
It was Kutztown's first homicide since 1982, officials said. This borough of 5,000 residents, nestled in farm country between Reading and Allentown, has had only three murders since 1968.
Quinn lived on campus, but investigators "don't know where he would have been coming from or going to at the time," borough Police Chief Theodore Cole told the Associated Press.
Authorities were investigating a motive.
The suspects were identified as Terry D. Kline Jr., who turned 22 on Thursday; his brother Kenneth R. Kline, 21; and Timothy R. Gearhart, 23. None of them is a student at the small state college.
The three were charged with aggravated assault, simple assault and conspiracy, and arraigned before District Judge Wallace Scott, who set bail at $10 million each. The victim's parents were at the arraignment.
Murder charges were pending on the results of the autopsy, according to officials.
The attack took place about a half-mile from campus, next to the China King restaurant.
On Thursday night, the street's shops, bars and restaurants were jammed with returning students, merchants said.
Tina Souilliard, who owns Beads of a Feather, a bead shop across the street from Shorty's, said Thursday night was particularly busy on Main Street because it was the first night that the kids really went out, the first weekend they could party.
And Shorty's, a cavernous hall that formerly had been an antiques warehouse, was featuring dollar-a-draft night.
With pool tables, banks of TVs tuned to sports programming, and an entrance out back in front of its parking lot, Shorty's is the kind of bar that is popular with students and townies, although many of them come from Allentown, Reading and other nearby communities.
It's also the kind of bar where up to a dozen bouncers can be seen working on a busy night, and patrons are checked with a metal-detecting wand before being allowed entrance.
Erin Cooney, 27, a spokeswoman for Shorty's, declined to answer specific questions about what happened Thursday night.
While students have been known to get drunk and disorderly, "it's never escalated into something like this," said Louise Hutchings, a 24-year town resident.
"Even if people have words with each other, to carry it that far, to kill someone, it's hard to understand. I can't comprehend it, actually. If there are three of them and just him, it's just complete brutality."
A white flower and two white votive candles marked the spot where Quinn was struck down. Witnesses said they heard yelling and screaming, and saw Quinn motionless on the sidewalk.
Kenneth Kline, who has a Mohawk haircut, kept saying, "I'm sorry, I'm sorry," as he was being handcuffed, according to one witness.
Quinn, a sophomore history major whose father is Leo Quinn III, chairman of the Warminster Board of Supervisors, had been on the campus for less than two weeks. He transferred to Kutztown after taking classes at Pennsylvania State University and a summer course at Bucks County Community College, according to the university.
An older brother, Dennis, also attended the university, said Robert T. Watrous, dean of student services and campus life.
Quinn was a graduate of William Tennent High School in Warminster, where he played varsity soccer in his senior year.
"He was just a really good athlete and a great kid," said athletic director Lou Pacchioli. "He was a very quiet kid" and a good student.
Last night on Centenary Lane in Warminster, where the Quinns live in a two-story red-brick Colonial, neighbors gathered on their front porch to console each other and await the arrival of the victim's parents and brother. So tight are the residents that one of them went from house to house yesterday morning delivering the bad news, and a planned block party may be postponed or canceled, said Jack Van Dusen, who lives across the street.
"I couldn't believe it, that somebody would just beat him up for no reason," he said. "I'm shocked this would happen to a boy like that."
Kyle Quinn, whom Van Dusen recalled trick-or-treating with his brother and their sister, Caitlyn, as a youngster, never got into any trouble, he said.
Steve Macrone, who emerged from the Quinn house to speak on behalf of the block of about 20 homes, said the victim's sister was inside but too devastated to talk.
"This is a kid that did everything right in his life and he just came across some bad people," he said. "And it's just hurting everybody."
According to a police affidavit, the three suspects were among a group of five men who had driven from Allentown to Kutztown. One of the men, Derik Houser, told police that they had been in a bar, and that after leaving, the Kline brothers and Gearhart "got out of the car and started causing a problem with a group of kids."
Houser said he saw Terry Kline throw a punch at Quinn and yell expletives at him.
Though Quinn barely had time to settle into his Bonner Hall dorm room, Watrous, the dean, said one faculty member who had met with him "spoke of him in glowing terms."
"We're still in a state of shock. We had counselors and campus ministers out and about all day long," he said.
Kutztown's president, F. Javier Cevallos, called the beating a "senseless, isolated, random act of violence" and urged students to be vigilant. He e-mailed students at 10 a.m. yesterday to inform them of Quinn's death.
Quinn's profile on the social networking site Facebook revealed a taste for the 1960s.
"I like a lot of other stuff but if WWIII started tomorrow I would only grab my Dylan albums," Quinn wrote.
Within hours of his death, friends began posting messages on Quinn's Facebook page.
"Don't be afraid of death, for it is only the beginning of the greatest adventure of all, The Unknown," wrote one.
"Life without you seems so empty. I know that you're smiling down on us right now with that great smile," wrote another.
The Associated Press contributed to this report.