University students who enrol in foreign language (FL) programmes are motivated by various needs, but in particular the need to achieve communicative fluency, which generally requires interaction with others. This study therefore explores the notion of 'interactivity,' as conceptualised in second language learning theories and how it might be applied in online and blended delivery settings. It also considers whether current levels of resourcing of FL programmes in Australia and England reflect the unique needs of FL learners in these countries, where FLs are facing serious challenges. The requirement for interactivity in FL teaching and learning in fact reinforces the need for more favourable funding to FLs when compared to most other humanities disciplines, as already exemplified in Australian and English university funding models. Theoretical constructs suggest that to develop students' interactional competence, programmes need to strike a balance between teachers' direct instruction and students' autonomous interaction with expert speaker peers. Guidelines derived from the theoretical exploration thus harness the potential for global connectivity and developing learner autonomy offered by communication technologies, to promote 'interactive' FL university programmes which are fundamentally social, intercultural and collaborative, with consideration for linguistic and technological-interactional constraints. Based on theories and current delivery practices, the study argues that interaction with native speaker peers would be facilitated through further streaming of beginners' courses, the introduction of compulsory FLs to final year of high school level, and continued implementation of favourable funding ratios at the chalkface, to arrest the decline of FLs in English-speaking countries.