Immigration Minister Damian Green has pledged to crack down on bogus colleges being used as visa factories as the number of students coming to the UK leapt by one-third last year to more than 300,000.
Official figures showed that the number of students coming to Britain from outside the EU to study increased by more than 75,000 in the 12 months to March.
Promising a "thorough evaluation" of the system, Mr Green said: "It's clear that there have been some large-scale scams with the student system.
"What I'm doing with an urgent review of the whole student visa system is to make sure that we can continue to attract the brightest and best to this country but also to stop that route being used as a scam. We know that bogus colleges have been set up to act effectively as visa factories and we are determined to crack down on this."
Visas for students from Nepal, Bangladesh and Northern India were suspended earlier this year after an unusually large rise in applications from the countries. "There was clearly a large-scale scam going on," he said.
Speaking at the Harmondsworth Immigration Removal Centre in west London, near Heathrow Airport, Mr Green said: "John Reid famously described the immigration system as not fit for purpose four years ago.
"It's very slightly better than that now and it's improving, but it's no surprise that one of the first acts of the coalition Government has been to move very quickly on immigration. We have to act on all parts of the immigration system to make it fit for purpose."
He added the Government would look at where the system was and was not being used for legitimate purposes and then target all routes of illegal immigration.
According to Home Office figures, some 313,011 non-EU students were granted visas in the 12 months up to March, bringing with them 31,385 dependants. This figure was up from 235,295 students and 24,780 dependants the previous year.
Sir Andrew Green, chairman of campaign group Migrationwatch, told the Daily Telegraph: "There is growing evidence that the new points-based system has provided a back door to Britain for bogus students."