The article examines globalization and higher education reforms in Israel. It critiques the expansion of the higher education sector, associated legislative changes, a sharp rise in the number of students, and the changing teleological goals of goals of higher education. The article argues that there are two options for policy change: to continue the current division in the higher education sector, where there exists competition, at the expense of excellence and collaboration between academic institutions, and where the quality of higher education diminishes as the number of student's increases; or to embrace the transformation of the higher education, and support academic institutions that are involved in a free, open, and competitive market, yet are required to meet high standards of excellence and quality assurance.