This paper examines changes in values and practices that are emerging in Mexican higher education, reviewing recent trends and policy dilemmas affecting colleges and universities in Mexico. It argues that the educational reforms carried out in the early 1990s indicate the movement away from a social welfare model of higher education, built around political negotiations between government and administrators, unions, and student federations, to a developmental model which emphasizes the themes of efficient management, educational relevance, and technological transfer. The paper also examines policy dilemmas in Mexican higher education, such as clarity of purpose, improvement versus accountability, institutional capacity to implement reforms, funding mechanisms, the blurring of public and private funding, accreditation of private institutions, and the internationalization of higher education. It concludes by arguing that more definite steps toward deeper and more lasting institutional reform are yet to be taken in order to anchor current reforms in technical competence, effectiveness, accountability, and stakeholder development. Contains six references. (MDM)