Texas Law Benefiting Thousands of Latino Students in Jeopardy

An appeals court dealt a judicial blow to the Texas Dream Act. This law, enacted in 2001, allowed undocumented students to pay in-state tuition at Texas public universities and community colleges.

The Fifth Circuit Court of Appeals’ decision rejected a lawsuit that sought to protect the benefit. This confirms a previous ruling by a federal judge that ordered the permanent halt of the law’s implementation.

The measure directly impacts approximately 57,000 young people currently pursuing higher education in the state. Furthermore, it threatens the academic future of roughly 197,000 high school students who are about to graduate.

What Does the Court Ruling Say?

The dispute centers on the legality of the Texas Dream Act. The federal government argued that the state law conflicts with a national prohibition. According to this federal rule, no state can offer educational benefits based on residency to undocumented persons unless that same benefit is available to any U.S. citizen.

In June 2025, Federal Judge Reed O’Connor ruled that the Texas law violated this restriction. He ordered a permanent block on access to in-state tuition for students without legal immigration status.

Texas Attorney General Ken Paxton chose not to defend the law in court. He agreed with the Department of Justice that the law was unconstitutional. The case reached the Fifth Circuit following a lawsuit filed by Austin Community College and a student. However, the appeals court rejected the claim by a vote of 2-1.

How Does It Affect Students?

The economic difference is enormous. In-state tuition is typically 3 to 4 times cheaper than the out-of-state rate. For example, at the University of Texas at Austin, a resident paid around $11,000 annually in the 2024-2025 academic year. After losing the benefit, that same student must pay the full rate, which can exceed $40,000.

Beyond the cost increase, young people lose access to state financial aid. This combination creates an insurmountable barrier to higher education for many undocumented students in Texas.