The Australian National University has come in as Australia's top ranked university in the latest international league table.
ANU ranked 27th in the world on the Quacquarelli Symonds World University Rankings for 2013/2014.
But it has fallen from 24th place last year and 26th place in 2011.
Its main Australian rival, the University of Melbourne is also closing the gap, coming in 31st this year, up from 36th in 2012.
ANU vice-chancellor Ian Young said he had been waiting for the results of the latest ranking "with interest".
"While rankings are imperfect measures and jump around year-to-year - we ranked 24th in 2012 and 26th in 2011 - they do provide some comparison with our international peers," he said.
The University of Sydney rose one place to 38 while the University of Queensland rose three places to 43.
Twenty Australian universities made the top 400.
The QS rankings are considered one of the top three most influential and reputable international league tables alongside the Times Higher Education World University Rankings and the Academic Ranking of World Universities originating from the Shanghai Jiao Tong University.
In this latest ranking, ANU is placed alongside partners in the International Alliance of Research Universities - the University of California, Berkeley, the National University of Singapore and University of Tokyo as well as the University of Hong Kong and Ecole normale supérieure, Paris.
"To be placed among such peers is an honour," said Professor Young.
"This is an outcome of which we can all be proud, and a reflection of the commitment and quality of ANU staff and students.''
"Rankings are not an absolute measure, but they do give us pause to stop and acknowledge what is great about ANU," he said.
The university has been beset by industrial unrest this year as Professor Young has instituted widespread budget cuts to cover a $51 million reduction in Commonwealth funding passed down by the former Labor Government.
Staff are also considering strike action to protest the breakdown of enterprise negotiations.
Professor Young maintained ANU was continuing to "invest in excellence" and also had major projects underway "that will improve administrative processes to provide more efficient support to our research and education activities".
He said that over the past 18 months, the university had increased its academic workforce by four per cent - some 70 staff - which had further reduced staff / student ratio in favour of student learning.
The National Tertiary Education Union said academic staff losses were imminent due to an early retirement scheme being enforced to save money. Management had also earmarked 230 administrative jobs to be shed at the ANU