The 18-year-old's parents raised funds for a safe play area at the Nicolson Institute in Stornoway, on the Isle of Lewis. However, MSP Alasdair Allan said they were "deeply upset" to see what had been constructed.
Western Isles Council - Comhairle nan Eilean Siar - said it wanted to apologise unreservedly to the family.
Norman MacDonald, vice- chairman of the policy and resources committee, said the enclosure was the result of a communication breakdown between staff and the supplier.
Mr Allan said the pupil's parents were full of praise for his teachers.
However, they had been unhappy that for the past five years he had spent almost six hours a day inside temporary accommodation with a teacher.
The parents raised funds to help cover the costs of a safe outdoor area, which they hoped would include decking and play equipment.
Mr Allan said: "Some months ago, the parents were deeply upset to see what had been constructed.
"It was what they describe as a small 'cage' sitting on the grass, constructed from old barriers and fencing of the type used on building sites.
"I believe that 'cage' is a reasonable description, and that this represents a failure on the part of the council to consider this young man's needs."
He added: "This has caused very understandable offence to this family and raises questions about the provision in the Western Isles for children in a similar situation in future. I have raised this matter with the council by letter and await a response."
The enclosure was taken down over the past two weeks.
The Nicolson Institute is the largest school in the Western Isles, with about 1,000 pupils.