The integration of artificial intelligence (AI) in higher education is transforming traditional teaching methodologies by enhancing student engagement, streamlining instructional support, and enabling personalized learning experiences. This study examines the challenges of traditional teaching in modern classrooms and introduces a custom AI Teaching Assistant (AI TA) designed for higher education, assessing its impact on student learning. Assessment results and data analysis revealed that AI TA significantly improved student engagement with course materials, reinforced concept comprehension, and enhanced access to academic resources while maintaining consistency with the instructor’s lecture and guidance. Students reported that AI TA fostered independent learning, played a crucial role in research support, and positively influenced their academic and career development in the subject area. The study also identified challenges, including concerns related to AI reliability, ethical considerations, bias mitigation, and academic integrity. Addressing these challenges is essential for the responsible adoption of AI in education. This study contributes to the growing body of research on AI in education, offering insights into the role of AI-augmented teaching in shaping scalable, innovative instructional methodologies.