AN $18 million donation to the University of Queensland by dotcom millionaires and former graduates Graeme Wood and Andrew Brice has been heralded as the beginning of a long-awaited shift to US-style giving to Australian universities.

Mr Wood - who made BRW's Rich 200 list last year with a $251 million fortune - has committed $4 million worth of Wotif.com shares and an additional $2 million over five years, while Mr Brice is putting in three million shares, worth just over $12 million.

Mr Wood told The Weekend Australian that his UQ masters degree in information systems had been instrumental in his success, "so it's a natural thing to give back in areas where I feel there's a real need". The interest from his donation will be used to establish a research and education centre targeting youth drug and alcohol abuse.

Mr Brice said he had been inspired to make his donation to the social sciences and humanities at UQ after seeing the positive effects on the New Zealand economy of the film blockbuster The Lord of the Rings.

"There are far greater economic benefits from the social sciences and humanities than people realise," he said.

Acting University of Queensland vice-chancellor Michael Keniger said UQ was "absolutely delighted" two alumni had shown their confidence in the university in such a generous way. Asked how he expected the money to be used, Professor Keniger said the university would be able to employ researchers and experts in the areas selected by Mr Wood and Mr Brice.

"It will enable a faster rate of change in the humanities and health sciences," he said.

The funds would be held in a trust at arm's length from the university, from which it would use the interest.

The donation, which will be used to start an endowment fund, is believed to be the largest single donation to a university by living Australians at the one time.

The established universities have larger endowment funds, with Sydney and Melbourne universities each having endowments of more than $1 billion.

But this falls well short of similar endowment funds overseas, with Harvard University's endowments totalling $37 billion.

Australian universities have been trying to implement the US model of philanthropy, and Sydney University vice-chancellor Andrew Coats said there had recently been a large rise in local philanthropy.

"We received $51 million last year, and we are up to $29 million this year," he said. "We certainly believe this is the start of a cultural shift to US-style giving to universities. The signs are there."

Coca-Cola Amatil chairman, philanthropist and UNSW chancellor David Gonski said the donation by Mr Brice and Mr Wood was "absolutely marvellous. It's so generous".

Mr Gonski said he agreed with Professor Coats that some Australian universities were starting to become the beneficiaries of wealthy and successful alumni.

"Fundraising has come of age in Australia," he said. "We now have a pool of people of wealth and intellectual foresight who know this is a good thing to do."

Professor Coats, whose university has an endowment of $1.3 billion, said there was an increasing international trend to donate to universities. He believed this was driven by the perception that governments had withdrawn from funding universities.