The latest Times Higher Education World University Rankings showed the University of Melbourne was the top institution in Australia, coming in 39th place.
While the university retained its position as the leading campus in the country for the 15th straight year, it was the lowest position in the 21-year history of the global rankings.
The University of Melbourne slipped to its lowest position on the global rankings at 39th. (James Ross/AAP PHOTOS)
The next best Australian university was Monash University, down from 54th to 58th, followed by the University of Sydney, which fell from 60th to 61st.
The Australian National University went back from 67th to 73rd, while the University of Queensland rounded out the top five Australian campuses in 77th place, a drop from 70th the year before.
The rankings showed 17 Australian universities fall down the scale, with seven having their worst results.
Just four institutions - UNSW, Macquarie University, Deakin University and Federation University Australia - increased their position in the latest list.
While Australia had 12 universities inside the top 100 in 2021, it now has just 10.
Times Higher Education chief global affairs officer Phil Baty said there were serious warning signs in the sector in Australia.
"Australian universities are losing ground in terms of their global academic reputation (and) funding levels," he said.
"Perhaps most alarmingly, they are losing ground in areas of great traditional strength: international research collaboration and the attraction of international talent."
Australia has been warned international student caps could lead to even lower ratings. (Paul Miller/AAP PHOTOS)
It comes as the federal government is looking to introduce caps on the number of new international university students.
Under the proposal, 53,000 fewer students would be allowed to enrol in Australian universities as part of a cap of 270,000.
Further details about the limit are expected to be unveiled in a Senate report handed down on Wednesday.
Mr Baty said the caps could lead to Australia's international standings in the university sector being reduced.
"Many in the sector are very worried about forthcoming international student caps, which may further erode income for some top institutions, as well as diminish Australia's world-leading reputation as an open and internationally facing sector," he said.
The report said Australia's average score for international students had dropped for the second year in a row, following repercussions from the COVID-19 pandemic.
The higher education rankings are measured across 18 metrics, such as teaching, research and international students.
Oxford University came out on top in the global standings, followed by MIT, Harvard, Princeton and Cambridge.
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