Hong Kong's universities are also regarded as having fared well, with University of Hong Kong moving eight places up to 33rd, with many highly regarded universities behind it, such as Sydney, Bristol, Nottingham and University of British Columbia.

The Chinese University of Hong Kong scraped in at 50, improving its position by one place on the previous year, while Hong Kong University of Science and Technology dropped from 43rd to 58th.

City University, the only other Hong Kong university in the top 200, moved up to 154th from 178th.

Nunzio Quacquarelli, director of QS Quacquarelli Symonds, an international education and career development group, said: 'Peking has consistently done well in this research. It has peformed well in academic peer review and citations and has a significant lead over Tsinghua.'

He expected mainland universities to continue to improve. 'The government is investing many resources and seeking to internationalise through partnerships.'

He described Hong Kong having three universities in the top 100 as 'astounding'. 'They do well on international faculty and well in academic peer review, the criteria we give the largest weighting to.'

Overall, the number of Asian universities in the top 200 rose from 31 to 33.

The rankings are based on peer review of 3,703 research-active academics worldwide, asked to identify up to 30 universities in the world best for research within their own field of expertise; recruiter review of more than 730 graduate employers around the world; the ratios of international to local faculty and students; and ratio of total students to faculty.

HKU vice-chancellor Tsui Lap-chee said he was 'very encouraged' by the university's position. 'The ranking reflects that our achievements on academic excellence, internationalistion and grooming of talents are recognised globally.'

The fact that Hong Kong had two universities in the top 50 was recognition of the standard of its higher education. 'It shows that we possess the necessary conditions for Hong Kong to develop into an education hub,' he added.

John Spinks, senior advisor to the vice-chancellor at HKU, said: 'Overall we are happy we have increased in the rankings. We can compare ourselves reasonably with universities in the US and Europe.

'Hong Kong universities have done quite well given we haven't been allowed to do much in international recruitment. When you look at research funding we can't compare with the US or even UK.'

He urged the government to increase funding for research. 'If you want to be considered at the top internationally you have to have funding accordingly,' he said.

CityU's deputy president David Tong Shuk-yin said: 'Moving up 24 places is a first-rate endorsement of all the hard work everyone on campus has put into developing CityU.'

A spokeswoman for CUHK said the university did not comment on ranking exercises.

An HKUST spokesperson said: 'University rankings can go up and down, but our effort to further improve our teaching and research is relentless.'

US universities took 22 of the top 50 places, compared with seven each for Asia and Europe and six for Australia.

Mr Quacquarelli said the US remained dominant in the top 50 because of the large endowments of its private universities. 'They have resources for research and for employment outreach for their graduates,' he said. If Europe wanted to match the US, more funding was needed for higher education.

However, he added European universities had outperformed their US counterparts in the top 200, and accounted for 15 of 24 new entries.

This is the third year the THES - QS World University Rankings has been published by the British-based THES with QS.

THES-QS WORLD UNIVERSITY RANKINGS 2006

1 Harvard University, US

2 University of Cambridge, UK

3 University of Oxford, UK

4 Massachusetts Institute of Technology, US

5 Yale University, US

6 Stanford University, US

7 California Institute of Technology, US

8 University of California, Berkeley, US

9 Imperial College, London, UK

10 Princeton University, US

14 Peking University, PRC

19 National University of Singapore

19 University of Tokyo, Japan

28 Tsinghua University, PRC

33 University of Hong Kong

50 Chinese University of Hong Kong

57 Indian Institute of Technology

58 Hong Kong University of Science and Technology