This paper focuses on the deregulation of university education in Nigeria, its problems and prospects. The paper commences with the recognition given to education all over the world, especially higher education. Nigeria as a country gives much credence to higher education as the means for social and economic mobility, social transformation, and as a major platform for higher level workforce development--managerial and technological. To achieve these laudable objectives, therefore, government has given approval to private individuals and organizations to own and manage private higher institutions of learning. This paper examines some of the problems that accompany privatization policy of higher education such as high costs, the widening of gap between the upper class and indigent students, and the circumvention of standards in the name of profits, among others. The prospect for this noble idea was also examined.