A proposed European Union directive aims to divert international students away from the UK to smaller member states.
Two-thirds of the 400,000 foreign students in the EU attend courses at universities in the UK, France and Germany.
The directive will ease visa restrictions operated by some EU member states to harmonise the entry and residence conditions for non-EU nationals wanting to study at universities in the 15 EU member countries.
It will encourage international students to attend universities in countries such as the Netherlands and Finland and will also benefit universities in countries, such as Belgium, that have opaque visa formalities.
Education commissioner Viviane Reding said that it was a "significant instrument" for attaining the objectives of the Erasmus World programme to attract more third-country postgraduate students to EU universities and colleges, while encouraging student mobility between universities in different EU countries.
The directive will give universities a legal right to reach agreements with their national governments to introduce "fast-track" procedures for granting visas to non-EU students. It will also give students who have a student visa in one member state the right to travel around the EU.
European Commission education spokesman Christophe Forax said that this could help dilute the large proportion that attend courses at universities in theUK, France and Germany, as it was "desirable" that at least some of their education should be in other EU countries. Students are drawn to the big three partly because the higher education institutions there are better known than those of smaller countries and partly because their languages are more attractive to non-EU students.
The UK, Ireland and Denmark cannot be bound by the proposals because they have not signed up to the Schengen agreement on common borders.
Universities UK welcomed the Erasmus World programme, but sounded a note of caution on the new proposals. A spokesman said that while international students must be allowed freedom to choose a European country of destination, UUK would be "concerned by attempts by the European Commission to direct student flows around the EU".
The UK has actively promoted the international profile of its higher education since the Prime Minister's Initiative in 1999, which includes improving visa procedures for foreign students and enhancing their rights to work while studying.