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For years, Brazil has had a system of higher education that has not adequately met the needs of the Brazilian companies or prospective students. In comparison to other countries in the region, Brazilian universities have enrolled a significantly smaller percentage of the eligible students, have not produced an adequately trained work force and have been cost prohibitive for lower income students. Both economic and societal pressures are now forcing changes upon the educational system. Together with the Minister for Education, members of the National Education Council, and others, World Bank staff participated in an assessment of options to improve higher education over the next two or three decades. This study describes the educational system, provides an economic perspective and contains specific policy recommendations resulting from the assessment.