This article describes the course and causes of the expansion of higher education in the UK since the 1960s. The number of university students from modest social backgrounds has increased, but they comprise much the same proportion of the university population as they did 40 years ago. Though personal rates of return from higher education are generally substantial, subject choice matters, while the extent of the returns to society is more problematic. Despite government statements to the contrary, there is still doubt about how productively new graduates will be employed in the labour market. Meanwhile, the sector has had to meet this expansion with tight public funding since the early 1980s. The article considers the impact of this and of the increase in compliance and audit costs. Finally it suggests that the incentive structures applied by the government may have made the different parts of the sector more homogenous than is desirable.