This report is the first output of a major project that Universities UK initiated in 2007. The project is intended to provide a basis for assessing the size and shape of the UK higher education sector in 20 years' time. Its analysis takes account of differences between the four UK countries. The project aims to improve understanding of the factors that may influence the growth of the sector and the position of universities (and groups of universities) within it. Appended are: (1) Projection of EU students on full-time first degree courses; and (2) Assumptions underlying the base projection. (Contains 21 tables, 29 charts, and 24 notes.)