Academics have warned that 2,500 language students could see their years abroad cancelled after the government asked the British Council not to open recruitment for English language assistant placements in 2011-12.
A year abroad is a compulsory element of most foreign language degrees and usually takes place in the third year of a four-year course.
Mark Williams, head of the School of Modern Languages and Cultures at the University of Leeds, said the suspension of the scheme would "make life incredibly difficult" for those helping students to secure placements abroad.
"In our case, it would imply a dramatic increase in the expense incurred by students and the school. It would also have a very negative impact on our partners abroad and on the study of English language and culture worldwide," he added.
Kathryn Board, chief executive of CILT, the National Centre for Languages, said that unless the decision was reversed, the move would "shut down opportunities for Britons that are widely enjoyed by their counterparts in other countries".
She said it was hard to believe that this was the government's intention, since overseas experience and foreign language competence are highly valued by employers.
The language assistant programme, which cost about £750,000 to administer last year, places language assistants around the world, including Europe, Latin America and Asia. The deadline for applications this year was to be 1 December.
The suspension of the scheme will exacerbate concern that the flow of students to and from the UK is predominantly a one-way street, with few Britons studying overseas.
Pam Moores, chair of the University Council of Modern Languages and executive dean of the School of Languages and Social Science at Aston University, said it would be "extraordinarily short-sighted" to axe funding for the scheme at a time when the study of languages in the UK was already struggling.
"It represents very good value for money in terms of public investment," she said.
The cut was also condemned by Labour MP Gareth Thomas, the shadow higher education minister, who said it was "bad news for students and bad news for our image abroad".
Recruitment will continue in Scotland and Northern Ireland, where the devolved administrations fund the language assistant programme. Recruitment to a reciprocal UK-wide programme for overseas students is also unaffected.
The programme was set up in 1905 to widen teaching experience and develop linguistic fluency and confidence abroad.
In the first year of the programme, 58 English teachers (41 men and 17 women) were placed in French schools and six English language assistants went to Prussia.