This study delves into factors contributing to the imbalanced development of higher education, which has led to the situation that despite higher education expansion, the universities' contribution to society has only improved a little. The study aims to understand this paradox and its policy implications, particularly in a developing country context, through a case study of Iran. We adopted an interpretive research paradigm to explore participants' experiences and perspectives, emphasising qualitative inquiry. Specifically, we applied a basic qualitative research approach, focusing on thematic data analysis to understand underlying meanings and patterns. We conducted semi-structured, in-depth interviews with 23 professionals from Iran's higher education system, including executive experts and academic scholars. The data were analysed using qualitative theme analysis with the thematic network approach. This study's findings reveal the intricate web of external and internal factors that can influence society's imbalanced higher education development. This research has various practical implications, which are crucial in balancing higher education development, including promoting long-term university development planning, nurturing academic creativity, and fostering a culture of learning and social commitment among academics. The findings of the study hold critical policy implications. By promoting national dialogues via universities, establishing accountability measures for policies set by political entities in higher education management, improving science and technology demands in the national economy, and advancing science and technology diplomacy, policymakers can enhance the positive impact of investing in higher education for society. This study shows, perhaps for the first time to some extent, why quantitative growth in universities may not lead to a higher quality of education and a more significant contribution of higher education to society's development.