UCT has been ranked 179th in the Times Higher Education QS World University Rankings 2008, climbing 21 spots from 200th place last year.
The Times Higher Education rankings are considered the primary benchmark for comparing universities across borders.
UCT was the only African university to be listed in the top 200. It was ranked 257 in 2006.
Vice-Chancellor Dr Max Price said: "It is great that UCT rates so high. We are pleased that we are competitive in the international higher education sector."
He added: "The rankings give us a sense of our position when measured using a specific set of criteria. As an institution, we constantly measure ourselves and the quality of our entire enterprise on our own well-developed set of criteria. This is an ongoing process aimed at continuously improving and strengthening our institution."
This year's THE-QS World University Rankings have reflected the increasing value attached to technology. Many top technology-based universities improved their position, a fact linked to a demand by international employers for more technology-literate graduates.
The Top 10 was still dominated by institutions from the US and UK. Harvard University kept their top spot, with Yale moving ahead of Cambridge for the second spot. Oxford dropped to fourth, while Princeton dropped out of the top 10, replaced by the only new entrant in the top 10, Columbia University.
Among the top 100 universities were 13 Asian institutions, the same figure in 2007. The number of North American universities in the top 100 dropped to 42 (43 in 2007).
Another striking trend was the "unprecedented" response levels to the survey - 6354 academics (compared with 5101 in 2007) and 2339 employers (compared with 1 482 in 2007).
Universities from 33 different countries (28 countries in 2007) are represented in this year's top 100.
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