Universities and colleges in Scotland struggling under their current funding deal are to receive an extra £20m in government funding.
The Scottish Government has pledged an additional £10m
Education Secretary Fiona Hyslop set out the package, which will come on top of £10m pledged in January.
The minister had previously promised to make universities a funding priority after being criticised for their spending review allocation of £263m.
Labour said the funding was "too little too late".
The additional £20m was welcomed by Scottish universities and colleges.
Ms Hyslop claimed the extra resources would allow colleges to further invest in priority areas.
She said: "For Scotland's colleges this will provide additional funding for priorities such as supporting young people who need more choices and more chances, articulation, and innovative approaches to learning delivery.
"We also understand the difficulties higher education institutions face in the final year of the current pay deal."
Colleges and universities will remain a priority for any additional funding that becomes available in the future years of the spending review, she added.
The additional £20m will see £10m go to universities and £10m go to colleges.
Convener of Universities Scotland, Sir Muir Russell, said the announcement was an "encouraging" signal from the government.
"This goes a very long way to addressing the cost pressures the university sector will face in 2008-09," he said.
Howard McKenzie, acting chief executive of the Association of Scottish Colleges (ASC), added: "We are delighted to see a further £10m coming into our sector which is working hard to improve learning and skills in Scotland. This additional investment is most welcome."
However, Richard Baker, Labour's higher education spokesman, said the extra funds were "too little too late to address a crisis of the SNP's own making".