This literature review explores the rapid integration of artificial intelligence in higher education, examining both institutional influences and instructional practices. It highlights how governance frameworks, resource allocation, and faculty attitudes shape access and responsible technology adoption. Pedagogically, the paper emphasizes the necessity of embedding AI literacy, critical evaluation, and ethical reasoning into curricula to prevent student overreliance on AI tools. Ultimately, institutions must balance innovation with accountability by carefully aligning AI tools with educational values to advance authentic learning.