Israeli universities' threat not to open for the new academic year has forced the Government to backtrack over budget cuts.
But the fate of the second semester hangs in the balance with the revelation of cuts to come in 2007.
The Committee of University Heads, which represents the country's seven research universities, said that unless the NIS1.2 billion (£150 million) that the Government cut over recent years from the higher education budget was gradually restored the "second semester will not open".
The committee's threat was withdrawn when the Government agreed to grant the universities NIS140 million of the NIS170 million that had been slashed from the 2006 budget.
The committee had sought restoration of NIS350 million of cuts made over the past two years.
The Finance Ministry plans additional cuts of NIS36 million in higher education funding in 2007.
The universities see the climbdown as only a "partial solution", according to Moshe Kaveh, president of Bar-Ilan University and chair of the committee.
A committee with representatives from the finance and education ministries, the Council for Higher Education and the Committee of University Heads is being set up to prepare a "five-year plan" for higher education in Israel.
It will recommend to the Government how much funding should be put back into the higher education system after its meeting in January.
Roger Kornberg, a Nobel laureate from Stanford University who spends several months a year at the Hebrew University, said recently: "Israeli science managed to achieve a lot with limited means, but there are limits to such miracles. It will not continue for long if science doesn't receive the desired attention from government sources."