Tuition fees are to be waived for the children of asylum seekers going to university in Scotland if they have been at school for three years.
The executive said it wants fair access to further education
The BBC has learned that they will also be entitled to grants to help young people stay on in S5 and S6 at school.
It follows a report showing children from asylum seeker families had overcome language barriers and racism to outperform Scots pupils in exams.
Overseas student fees at university can be £8,000 to £26,000 a year.
The pupil allowance amounts to £30 a week, although a report this week suggested the grants were not currently an effective use of public money.
However, Education Minister Fiona Hyslop said every child in Scotland should receive the same care, protection and education.
Ms Hyslop said: "We are determined to work with the Home Office to make progress on the key issues that affect the welfare of children like dawn raids, the detention of children at Dungavel and the review of cases of families who arrived before December 2006.
"I am seeking an early meeting on these matters and have already conveyed these views to Home Office ministers.
"However, we are acting now to improve the prospects for asylum children, ensuring they are treated fairly and that their rights to care, protection and education are respected.
"We are moving quickly to increase access to full-time further and higher education and nursery places."
The minister said the executive would work with Glasgow City Council to implement school inspectors' recommendations on providing nursery places to three and four-year-old children of asylum families.
Ms Hyslop said the Scottish Executive would also talk to the Home Office about the right to work for the asylum community.
However, Glasgow South Labour MP Tom Harris said the idea was based on "a misunderstanding" of the asylum process.
"I think it will undoubtedly create a magnet in Scotland for asylum seekers throughout the country," he said.
"I think it will create an extra attraction for families who may be considering agreeing to removal back to their own countries in the event of their asylum case being removed.
"They may now think there may be special reasons to try and stay in the country rather than obey the law and be wilfully removed from the country."
There are currently about 1,400 asylum families in Scotland, mostly in Glasgow.
Universities Scotland has called for asylum children who attend Scottish secondary schools to have the same rights to further and higher education as Scottish domiciled students.