The Burmese opposition leader is using a video message to address a gathering of university leaders in London.
Burma's university system needs to be "put back on the map" of international higher education, Ms Suu Kyi says.
"Now the standard of our university education has fallen so low that graduates have nothing except a photograph of their graduation ceremony to show for the years they spent at university," she says.
Ms Suu Kyi chairs a parliamentary committee drafting laws to reform higher education in Burma.
She says that Burmese higher education has suffered badly from decades of political unrest.
Ms Suu Kyi says that her country needs to develop a modern, independent university system where academic freedom is guaranteed.
She says: "Academic freedom, which to you seems natural, is for us a distant dream." Campus life needs to be regenerated to encourage young people to meet and share ideas.
She has been speaking at the end of a study tour of UK institutions by senior Burmese representatives, organised by the British Council.
Emphasised long links
While Burma's universities have been isolated, globalisation and international competition in higher education have accelerated.
Ms Suu Kyi has emphasised the long links between Burma and the UK.
"At one time the education system in Burma was very closely linked to the education system in Britain. In fact, we could say that modern education was introduced to Burma by the British government. Now we have to learn all over again.
"We have to learn to change our education systems to deal with the demands of modern times."