This paper deals with the impact of the global financial crisis on Japan's economy, especially on its higher education. The first section provides an overview of Japan's national economy with a focus on the impact of the global financial crisis on the national economy, then the author touches on the impact on the Japanese government's finances, and goes on to look at the impact on Japan's higher education system, concentrating on government expenditure on higher education, student enrolment, changes in funding for national and private institutions as well as trends in tuition and fees in national and private universities. The author concludes by arguing that there is little evidence to show that the global financial crisis has directly affected the Japanese government's funding of its national or private institutions, nor has it significantly influenced the unemployment rate of university graduates due to the long-standing economic recession, which had occurred prior to the global financial crisis.