The presence of universities in tourist cities creates complex interactions that reshape urban dynamics, including real estate markets, economic development, and social structures. This study examines the dual influence of academic institutions and tourism, focusing on how these forces affect urban regeneration, housing availability, and the local economy, using Alghero (IT) as a case study to explore the synergies and tensions arising from competition between students and tourists for urban spaces and resources. Combining quantitative methods with qualitative insights, the research includes a student survey conducted via questionnaire. The findings reveal that universities often drive the regeneration of underused urban areas but also intensify housing market pressures. Competition between student accommodation needs and tourist demand for short-term rentals frequently leads to rising rents and gentrification. Nonetheless, universities contribute long-term benefits, such as urban revitalization, economic diversification, and improved public infrastructure. Alghero’s experience highlights the importance of policies that balance the needs of students and tourists. The findings suggest that cities with strong tourism sectors and growing academic communities must carefully manage housing and urban planning to foster sustainable development while maintaining social cohesion.