Colleges are challenging plans aimed at beating visa abuse, which would mean an effective ban on the recruitment of international students.
Rules proposed by Prime Minister Gordon Brown would prevent students being issued with visas for courses below degree level because the Government argues these are most at risk from scammers.
About 60,000 students a year come from abroad to study at UK colleges, half of whom are from outside the European Union. Nearly pound;30 million of college income would be at risk if the changes were implemented.
Mr Brown said: "The risk of abuse is higher in relation to shorter courses at lower qualification levels below degree level. Our universities continue to offer high-quality degree and post-graduate courses to foreign students. They contribute greatly to universities, and to our research base and to our economy."
But colleges argue that their international recruitment is already heavily regulated under the new points-based immigration system. Colleges must sponsor international students and are responsible for monitoring their attendance and reporting absences to immigration authorities.
Martin Doel, chief executive of the Association of Colleges, said: "Colleges provide much-valued vocational and academic training to 60,000 foreign students every year. This is a source of considerable benefit to the UK economy and to the students themselves.
"This is very different from the so-called `bogus colleges' that mislead both students and the UK Border Agency. All our members are subject to stringent regimes of public audit and inspection."
He said the Government should focus its efforts on unregulated private colleges and consider protecting the term "college" in law so it could only be used by genuine educational institutions. No publicly funded college has been implicated in immigration scams.
Colleges also fear that the proposal could have a knock-on effect on university recruitment, since many of them benefit from international students progressing from college courses to degrees.
The expansion of international recruitment in colleges was a priority for Tony Blair, who launched the Prime Minister's Initiative in 2006, a five- year strategy that promoted college links with other countries. It was backed with pound;27 million of funding over its first two years and aimed to recruit 100,000 extra students to UK colleges and universities.
Ealing, Hammersmith and West London College last year won a Queen's Award for Enterprise for recruiting international students, the first time a college had been recognised for promoting foreign trade.
It claims to have the largest number of international students in FE, with over 2,000 recruited from India, China, Vietnam and Iraq, bringing in over pound;4.5 million to the college and pound;16 million to the London economy, according to British Council estimates.
Principal Paula Whittle said: "At a time when colleges are being asked to rely less on public funding and look at new and creative ways of generating independent means of income, the review of international student visas will erode the ability of further education to remain flexible and responsive to learners' needs.
"It is important that the Government recognises the contribution to the UK economy of international students who come to the UK to access our globally recognised and respected education system."
A Home Office spokeswoman said the review was due to report its conclusions next month.
"The review is looking at those below graduate-level courses," she said. "The points-based system provides flexibility and means that we can respond to changing economic circumstances or experience and intelligence from our officers.
"This is why we have acted to pause on considering applications from some regions in China and why the PM has announced a review of qualifications and English-language courses for below graduate-level courses."