What is the correct verb to use, is it is or are?
A) The number of students are larger than before.
B) The number of students is larger than before.
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Compare these examples:
 A number of students were arrested.
 The number of students arrested has not been revealed.
In  the indefinite article "a" indicates an imprecise number and is said to be number-transparent in that the number of the whole NP is determined not by the head but by the noun that is complement to "of". As it happens, in this use "number" selects plural nouns as complement to "of", so the verb is always plural.
In  the definite article "the" represents a precise number and hence the subject NP is singular by virtue of having singular non-transparent "number" as head.
You should use the singular verb "is", because "the number" (as opposed to just "a number") makes the number, rather than the students, the subject.
As an aside, it is more common to use "greater" than "larger", especially when comparing numbers, as you are. I would phrase it as:
The number of students is greater than before.