Postgraduate education is facing an "emerging crisis" after being neglected by politicians for years, a report found on Thursday.
It calls on the government to take immediate action amid concerns that their higher education reforms will case "great and lasting damage" to postgraduate study.
The report, by the 1994 Group which represents 19 leading UK universities, examines the future of postgraduate study and concludes that it has found "an emerging crisis".
It says that compared to undergraduate, or degree, studies, postgraduate education "has suffered neglect from successive governments".
The Browne Review of higher education, and the government's white paper on the issue, failed to consider postgraduate study "with any degree of rigour", the report says.
"Furthermore, the higher education (HE) reforms initiated by the coalition will cause great and lasting damage to postgraduate provision unless action is taken now," it adds.
The report warns that funding cuts will force institutions to raise fees, and at the same time, students may be put off continuing their studies after building up increased debts while studying for a degree.
"Any damage to progression to postgraduate study will have severe and long term impacts for the UK," the report says.
The 1994 Group says that the numbers of UK students taking postgraduate courses rose only marginally between 2002/03 and 2007/08, leaving the UK lagging behind as rising numbers of international students come to this country to study.
Their report says that with no support system in place for postgraduate students, who are required to pay their fees upfront, those from disadvantaged backgrounds will be the least able to meet postgraduate course costs.
It says that while moves to encourage more disadvantaged students to study for an undergraduate degree are welcome "by neglecting the effects on postgraduate study, greater barriers will be erected to accessing higher degrees".
The report also says that a decline in postgraduate education will have an impact on the economy.
It calls for ministers to reconsider the withdrawal of teaching funding for postgraduate study, and for action to be taken to encourage banks to offer better terms for personal and career development loans (usually used for studying). These loans should also be more widely available, it says.
Professor Michael Farthing, chairman of the 1994 Group and vice-chancellor of Sussex University, said: "High level skills are absolutely essential to the country's long term economic prospects but we're in real danger of choking off the pipeline of future postgraduate talent.
"The government's failure to address postgraduate funding has been a real error of judgment and we need to see some immediate action to avoid disaster."
A Department for Business spokesman said: "We have a highly successful postgraduate sector in this country which has grown substantially over recent years. Hefce is providing additional funding to universities for taught post-graduate students and high cost laboratory and medical subjects will also continue to be supported.
"We have asked Hefce to monitor and review participation in postgraduate study as our student finance reforms are implemented."