Do many people occupying commonplace leads to pollution?

If your question is regarding many people in a closed room occupying little space, it may be these people are using up all the fresh air for breathing. The quality of air goes down, and you may get the feeling of suffocation.
In the case you share a room with other inmates which is poorly ventilated, and used for preparing and storing food and keeping other basic stuff. This enclosed environment creates an accumulation of a harmful gas which is released while we breathe out, and if the air circulation is poor, you might feel suffocated or choked. The common chemical pollutants in urban commodity products like lead and the indoor air pollutants from fuel combustion, toxic/hazardous wastes cause air pollution. If that is the case, make sure there is at least one door or window open. Even better is to have two of them open so the air can circulate. If there is a fire of any sort in that room, extra care must be taken as the fire uses the fresh air to burn and can at the same time produces a toxic gas which pollute the air and can be fatal.
If your question is about many people occupying a colony or a basti, it can be said that the more people are living closely together, the more care must be taken with any form of waste that is produced. Waste from the toilet and kitchen end up in the drain. That is not a problem for a single household, but if many households deposit their waste all at the same place, the amount of waste pollutes the environment in many ways.