Australia's higher education system is internationally renowned, with foreign students from all over the world increasingly attracted to its high quality institutions. According to the OECD, Australia is among the world's top five providers of education to foreign students, and is particularly well placed to satisfy the fast growth in demand for knowledge workers in the region. Management and commerce courses continue to attract the largest numbers of foreign tertiary students to Australia.

In 2006, more than 250,000 international students were studying at Australian higher education institutions, with nearly 66,500 or 26% of them enrolled in New South Wales. Almost 68,175 overseas students were studying at offshore campuses operated by Australian universities. A 2004 report co-authored by IDP Education Australia Limited (an independent global organisation) and the British Council shows that Australian universities have already captured 10% of the world market for students seeking an English language education, behind only the United States and Britain. Australia was described as a major international competitor in this area.

Apart from its respected education system, Australia's desirable quality of life, warm weather, secure environment and comparatively low living and educational costs contribute to its attractiveness as a regional centre for education.

The countries providing the most numbers of overseas higher education students to Australia are China, Malaysia, Singapore and Hong Kong SAR. IDP Education Australia Limited predicts international demand for Australian higher education will increase nine-fold over the next two decades, with China, India and Malaysia expected to drive this growth.