China and Vietnam have experienced drastic social, economic and political changes, especially when these two socialist regimes have started economic reforms in the last few decades. In order to create more opportunities for higher education with limited national resources, both Chinese and Vietnamese governments have adopted strategies along the lines of marketization and privatization to "reform" their higher education systems. The major objective of this article is to critically examine how the market transition taking place in China and Vietnam has led to changes in education governance, particularly examine how these two governments have approached the challenges of global capitalism by transforming the socialist education model into a more market-oriented one. This article also discusses the major challenges and policy implications when education is increasingly privatized and marketized in China and Vietnam.