A national review agency has found that Avondale College is well on its way to achieving university status.

The Australian Universities Quality Agency's first review of the college, released yesterday, praised its teaching and learning but said it had to do more research to become a university.

The college expects to become recognised as a "university-college" by the end of 2011 and reach university level in a further five years.

New college president Ray Roennfeldt said the 1250-student college could accommodate as many as 3000 students as a university but was unlikely ever to rival the University of Newcastle.

"We would be a niche-market university. People are particularly interested in coming here who understand our ethos," Dr Roennfeldt said.

In 2007 after 10 years of lobbying, the college was planning to call itself a university within 18 months. However, the joint ministerial council on education changed the procedure for progression.

The agency's report said the college needed to improve internal procedures, planning and rationalise courses but was positive about its low staff-to-student ratios.

Dr Roennfeldt said its research was likely to be focused on the education, nursing and health, and society and culture fields but would not be limited because it was a Seventh-day Adventist college.

"We have a policy of freedom of inquiry and we are not afraid of people researching and coming to conclusions that the church may not agree with," he said.

"We jealously guard our freedom as an educational institution."

Avondale is the only Seventh-Day Adventist College in Australia and offers 43 degree programs from undergraduate to doctorate level in arts, humanities, business, education, nursing, sciences and theology.

It has grown by 40 per cent since 2004.