Labour MP Jeremy Corbyn accused Immigration Minister Damian Green yseterday of creating "an appalling image" of Britain by banning a London university from recruiting non-EU students.
Speaking in the Commons, the Islington North MP said pulling highly trusted sponsor status from London Metropolitan University would deter foreign nationals from studying in Britain.
The Border Agency (UKBA) stripped London Met of the status last week, saying that university officials hadn't monitored students' attendance.
It means the university can't authorise visas, and its 2,000 non-EU undergraduates could be deported.
Mr Corbyn said: "The image around the world is one that is really quite appalling because it suggests that overseas students may well be deported from this country because of a decision made by UKBA for which there is no detail given as to the basis of that decision."
He said it put London Met's future at risk and urged ministers to let current students finish their studies.
"Every university in this country has cause to be concerned by this decision from UKBA," he added.
Mr Green said: "UKBA found systemic failures which meant that London Met had not been able to ensure the appropriate admission and tracking of students from abroad."
Letting London Met carry on would undermine the visa system, he claimed.
Officials will start writing to affected students on October 1, giving them 60 days to leave Britain or find another university.
The Lib Dems also criticised the move, with Edinburgh West MP Mike Crockart accusing UKBA of "heavy handed, rhetoric-induced action."
Mr Green claimed punishing London Met was the "opposite of rhetoric.
"Instead of years of immigration ministers from the previous government talking tough and acting weak, we now have a government that is acting tough as well."
Labour MP John McDonnell said threatening to deport current students was "grotesquely unfair."