The most significant distinction in revenue sources for the 3,600 nonprofit institutions of higher education in the United States is between public institutions governed by one of the 50 states and private institutions governed by private boards of trustees.
Tuition is a smaller but still significant part of the revenue for public institutions.
In contrast to many nations, all public and private institutions of higher education in the United States charge tuition. State government is the source of 36 percent of the revenue for public institutions but only 2 percent of that for private institutions. Revenue from state government is the largest single source of revenue for public institutions, which receive block grants for core functions such as their instructional program. The states generally do not supply any general operating funds for private institutions. However, the revenue to public institutions from local governments usually consists of operating funds for local public institutions, typically two-year community colleges.