The field of higher education in India is undergoing a transformation due to the rapid growth of Artificial Intelligence (AI) technology worldwide. With over a thousand universities, India's higher education system faces challenges related to scalability, education quality, and management efficiency. AI has emerged as a disruptive technology, offering advanced solutions to improve education delivery and administrative operations. Its frequent implementation has facilitated individualized learning environments, intelligent educational systems, AI-powered virtual assistants, and automated administrative functions. AI enhances student learning experiences by providing real-time feedback, personalized learning, and access to virtual mental health support tools. However, the full integration of AI in education faces obstacles such as unstable infrastructure, insufficient faculty training, and concerns about security and privacy. This research examines the impact of AI on modern higher education institutions in India, highlighting both its benefits and challenges. Furthermore, the paper explores AI’s role in shaping the future of higher education by fostering research, skill development, and accessibility.