This paper examines the commodification thesis as it applies to teaching and learning in higher education in the context of the knowledge economy. It indicates that higher education has been positioned by governments as an indispensable contributor to national post-industrial economic strategies. Not only is higher education expected to develop innovations in knowledge and technology, it is also expected to impart multiple higher order skills to significant proportions of the population. Such skills include subject-specific skills such as scientific and technological expertise, and more generic and transferable skills including the capacity to innovate and the ability to engage in lifelong learning in order to engage with constantly changing tasks and technologies. Drawing on the recent literature on effective pedagogy in higher education, we produce a model of teaching and learning which can be labelled as the 'new cognitivism' which contains features such as reflexivity, constructivism, feedback, risk, and motivation. We argue that these features are essential for the development of complex higher order skills. Our thesis is that the repositioning of higher education as a global service operating mainly on the basis of narrow economic considerations, together with the application of neo- liberal funding and quality frameworks, has led to fundamental changes in the nature and structure of teaching. We combine insights derived from sociological and educational theory to argue that teaching and learning in higher education has been penetrated by the logic of the commoditised economy in the sense that it is increasingly being undertaken with the primary aim of generating financial (rather than cultural or symbolic)outcomes under market - like conditions. The paper asks the question whether there are certain types of intellectual activities, and certain sites, which are particularly vulnerable to commodification. As illustrative case studies, the paper considers the rise of virtual higher education and the export of higher education from industrialised societies to developing countries. These case studies serve to illustrate how the fragmentation and instrumentalisation of course content, assessment and delivery and the reification of pedagogic relationships can easily contrast with the principles underpinning the 'new cognitivism' model. In addition, we argue that the link to qualifications seen as tradable commodities is a crucial element of the commodification process. We conclude by arguing that the commodification of teaching and learning is likely to result in educational processes which are likely to undermine the high skills economic strategies espoused by national policy makers.