Overnight, vice-chancellor Professor Brian Schmidt released a lengthy statement defending the back down from the lucrative deal amid a "flurry of interest" and criticism from both John Howard, who chairs the centre, and federal education minister Simon Birmingham.

Six months of negotiation came to a halt last week over concerns about academic freedom. Some academics warned the proposal could give "unprecedented" control of the curriculum to an outside philanthropic organisation and push one narrow view of history, following reports Ramsay Centre staff had asked to sit in on classes to monitor content.

Professor Schmidt said the Ramsay Centre had presented an "interesting" opportunity but stressed the ANU's "outstanding reputation" for academia already represented "some of the very best scholarship of the western liberal tradition".

"It was my judgement that ANU had a fundamentally different vision for the program than the Ramsay Centre, and that there was no prospect of us reaching agreement," he said.

"In that context, the only responsible course of action was to withdraw...I understand this caused disappointment to some, but my first duty is to advance the university I am so proud to lead.

"We retain, without compromise, our academic integrity, autonomy and freedom, and ensure that any program has academic merit consistent with our status as one of the world's great universities."

The National Tertiary Education Union and ANU student associations wrote to the university last month to warn of a potential "backlash" if the final deal was seen to compromise on the ANU's values or link the university to a "divisive cultural and political agenda".

The course was to be funded as part of a $3 billion bequest from health care magnate Paul Ramsay, and would have offered about 30 scholarships worth $25,000 each to students.

Fears spiked when former prime minister Tony Abbott, who also sits on the board of the centre, wrote an article in Quandrant magazine suggesting it would wield influence over the degree's curriculum and staff.

The Ramsay Centre "is not merely about Western civilisation but in favour of it", he declared.

According to the ANU's website, decisions on the course's curriculum would have been made by a "partnership management committee" consisting of two academic staff from the Ramsay Centre and two university academics. The course had been expected to launch in first semester next year.

In the wake of the ANU's decision, a spokeswoman for the University of Sydney confirmed the university was now in conversations with the Ramsay Centre "about the possibility of financial support for teaching at the university".

"[The vice-chancellor] assured [the board] that any program attracting such support would need to go through the usual processes for course development and approval and the university cannot do anything that threatens its academic freedom or integrity," she said.

"The University of Sydney needs to make its own assessment of the opportunities and risks independent of the current noise."

In 2016, more than a hundred academics at the university protested against the bestowal of an honorary doctorate on Mr Howard, arguing the former Prime Minister was "not a fit recipient" due to his treatment of refugees and Indigenous Australians.

In his statement late on Tuesday, Professor Schmidt was also forced to defend the ANU's Centre for Arab and Language Studies, after it was singled out for accepting donations from the governments of Dubai, Iran and Turkey.

"The Centre is an important national institution that has received bipartisan support since its establishment...all its activities, including appointments, have been under the exclusive control of the university," he said.

Professor Schmidt confirmed the donations in question but said they had been matched by the university.

ANU centres often received money from countries in addition to funds from the Australian government and industry, he said.

At Senate Estimates this week, Mr Birmingham lashed out at both the union and student associations, who backed the university's decision to withdraw from the degree, accusing them of stoking "fear and negativity" about the Ramsay Centre's "significant bequest".

The centre has maintained it upheld "the principles of academic autonomy" at all times during discussions with the ANU.

Mr Howard said the decision was at odds "with the tenor" of negotiations just two days prior and he intended to release correspondence with the university.