You have to set the project up for J2SDK 1.4 or greater. The default is 1.3, which predates the addition of assertions.
If you select the project properties dialog, click on the "Java Compiler" topic and then select the "Compiler compliance" tab, you'll see options. You need to pick 1.4 or greater for both source and class file compatibility.
Note that this doesn't affect
Ant Scripts, where you have to add the 'source="1.4"' option on the javac task or the interactive
Java compiler in Eclipse will handle asserts properly (assuming you did the above) but batch compiles using your Ant file (if present) won't.