This paper explores opportunities and challenges presented by the development of graduate skills in Australian universities. We challenge the dichotomy that conceives of a fundamental disjuncture between the idea of universities as institutions of vocational education and the more traditional conception of universities as key institutions in the formation of reflective practitioners, social critics and good citizens. Despite the challenges inherent in implementing the graduate skills project, we conclude that a consensus around the value of graduate skills represents a valuable opportunity for universities to regain control of the higher education agenda and renew their traditional, higher purpose.