International education is the third largest export industry in Australia and is worth almost A$20 billion. The last ten years have witnessed significant growth in both onshore and offshore enrolments of international students in Australian universities. The offshore component of all Australian universities has been subject to scrutiny by the external quality agency, Australian Universities Quality Agency (AUQA), since 2001. Many universities have closed offshore programmes after cycle one audit owing to poor management and quality assurance arrangements raised by AUQA. 2010 marks a significant change in international onshore education in Australia. Some of the changes that are having a real impact on international education include: (1) changes in government policy related to skilled migration; (2) policy changes relating to international student visas; (3) safety and security of international students following recent attacks on international students from India; and (4) ongoing scrutiny by the external quality agency with internationalisation as a mandatory theme in all quality audits of universities. The changes in Australian international higher education are a learning experience for many countries where tertiary education institutions are relying on international student income to survive, and planning for growth in an environment of changing government policies related to quality assurance, coupled with changing migration policies with a focus on reducing skilled migration. At the same time another challenge for Australian international education is the investment in education in key markets such as India and China, where the governments are planning to expand higher education with provision for overseas universities to open campuses in their countries. The renewal of quality in Australian higher education with the formation of the new national regulator, Tertiary Education Quality and Standards Agency (TEQSA), may witness increased scrutiny of high-risk areas, such as internationalisation, which are related to academic quality and reputation of Australian higher education. TEQSA will have powers to place sanctions on all higher education providers including universities. International education, though attractive, has a somewhat turbulent nature. The end of the rainbow may not necessarily mean a pot of gold, but possibly "fool's gold"!