The University of Adelaide and the University of South Australia are considering merging to create a new, leading Australian university in a move welcomed by both the state and federal governments.
Both universities have agreed to explore if a merged institution would deliver better outcomes for South Australia and for students.
They have agreed to a six-month collaboration period, with a report to be delivered by the end of the year.
"The national and international landscapes of higher education are rapidly changing," chancellors Kevin Scarce and Jim McDowell said in a joint statement on Tuesday.
"Now is the time to facilitate a conversation about whether uniting our universities would create a new, internationally renowned university of scale that would be well placed to anticipate and respond to this changing landscape.
"We need to determine whether this would enable us to deliver greater access and benefits to students, create more opportunities for staff, enable greater collaboration with and contribution to our community and make greater economic, social and cultural contributions to South Australia."
Premier Steven Marshall said the two organisations were to be applauded for addressing a long-standing issue head-on.
"No matter what the outcome of this process, their intention to work together shows that both institutions have the best interests of South Australia and its prosperity at heart," he said.
Federal Education Minister Simon Birmingham said the two universities had distinctive but complementary missions.
"It's pleasing to see the universities of Adelaide and South Australia acknowledging that bold leaps may be required to deliver higher education that best serves South Australia's future requirements," the minister said.
