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The realization of world-class universities is a dream of every researcher and national government. However, making them and maintaining their status is difficult even in highly developed industrial countries. Consequently, national governments tend to concentrate financial investment in their top universities, usually with the support of leading members of the academic community. It is not clear that such sponsored development of a limited number of universities is truly the most efficient approach to enhancing the quality of research and development in any one country. Similar to the effect of Korea’s BK21 scheme, dispute among researchers was widespread when the Japanese government endeavoured to select around 30 “top” universities. In order to provide sustainable incentives, foster accountability and promote competition among institutions, national policies must aim for the enrichment of “flagship universities” while continuing to support the knowledge infrastructure for “ordinary” ones. This article analyses Japanese “World-Class Universities” policies from the perspectives of both researchers and the national government. This topic is treated as an issue facing most OECD countries.