Unions have warned that Muslim students must not be marginalised by the Government's determination to crack down on terrorism.
The Association for College Management (ACM) and the Association of Teachers and Lecturers have raised concerns since a consultation was announced by Bill Rammell, the further and higher education minister. Both argue that there should be more emphasis on promoting social cohesion and less on spotting potential terrorists.
The managers' union said in its response: "In addressing this, it is important that we actively and clearly distance ourselves from those forces that seek to demonise Muslim communities."
The union said that many Muslims were at risk of being marginalised because of their poor economic position compared with the rest of society, with Pakistani and Bangladeshi communities at the "bottom of the heap" in terms of earnings.
Similar concerns have been expressed by the lecturers' union. Mary Bousted, its general secretary, said: "The Government has put the cart before the horse. Rather than supporting colleges that attract students from a wide range of backgrounds and help these students live and learn together, it has put an emphasis on preventing terrorism in a way that could create further divisions in society.
"These proposals could lead to a breakdown in trust between students and colleges and do more damage than good."
Colleges are being urged by the Department for Innovation, Universities and Skills to be aware of the literature of invited speakers, which might encourage extremism, and to report their suspicions to the police.
As early as February, when the consultation was announced, there were concerns about the impact on Muslim students.
The University and College Union said it was concerned that the focus on al-Qaeda-inspired terrorism would make Muslims feel they were the focus of the wrong type of attention from fellow students and staff, who were effectively being encouraged to monitor them.
Mr Rammell speaks at the ACM's annual conference in Birmingham next Friday.