Financing higher education is the economic behavior to finance the higher education by using fiscal measures, market mechanisms and financial innovations in the market economy. In the 1990s Asian financial crisis, to stimulate consumption, Chinese universities began to enlarge the enrollment, and higher education assumed the task of stimulating the domestic demand. Now the financial crisis took place again, of course, we can not take enrollment approach any more. At the national launch of 4,000 billion yuan economic stimulus plan, education and health together only occupy 40 billion, representing only one percent, and the funds related to education is only 4.4 billion which is to be invested in basic education in the Midwest. With no hope in the increase of the government funding and tuition fees, colleges and universities should expand the financing channels and financial capacity to meet the demand for funds of their own development. In this paper, the financing of higher education and the status are analyzed; the main problems and reasons of the financing of higher education has been identified, and therefore the strategy has been made to improve the financing of higher education.