International trade in post-secondary educational services has grown substantially over the past decade. Traditionally it takes the form of international student/teacher mobility but also, and increasingly, foreign investment by educational institutions or e-learning services. These developments in international trade in post-secondary educational services, which have come to the fore with the inclusion of educational services in the World Trade Organisation's negotiations on the General Agreement on Trade in Services, are causing great concern in the teaching and student community. This paper analyses the challenges and opportunities that international trade in educational services represents for higher education systems in industrialised and developing countries, and shows the importance of international quality assurance in education. Breaking with studies that view the international education market as homogeneous, the paper argues that traditional higher education will be less affected by these developments than the lifelonglearning sector, and that trade in such services will expand more in the developing countries than in the industrialised world.