Labour leader Ed Miliband says his party would lower the cap on student tuition fees if returned to government.
He told the Sunday Mirror that Labour would limit university fees to £6,000 a year, down from the current £9,000 cap.
It would be partly funded by higher interest on student loans for graduates earning more than £65,000 a year.
Universities Minister David Willetts said Mr Miliband's announcement made Labour's vote against fee increases last year look "completely cynical".
"Ed Miliband promised a graduate tax and now he's accepting fees have to increase to finance universities in tough times. So why should students trust anything he says? He says one thing to become leader and within a year does a U-turn," Mr Willetts said in a statement.
The policy announcement comes on the eve of the Labour conference in Liverpool, with Mr Miliband set to speak on Tuesday.
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If they think this is going to be a manifesto policy, then I'm sorry - this isn't going to win support of students”
Liam Burns National Union of Students
BBC political correspondent Ben Wright - in Liverpool for the conference - says the party knows it needs to use the event to appear relevant and credible on the economy.
He says Labour believes cutting fees would encourage graduates to start businesses because they would face less debt.
'Burdened by debt'
The move is part of Mr Miliband's bid to present his party as being on the side of hard-pressed families struggling to maintain their standard of living amidst the global economic downturn.
He told the Sunday Mirror: "Parents up and down this country are incredibly worried about their sons and daughters - including their chances of going to university.
"We want to take action to make it easier for people to go to university and not feel burdened down by debt. If we were in government now, we would cut the maximum tuition fee from £9,000 to £6,000."
Labour would cancel the coalition government's planned cut in corporation tax to help fund the policy as well as making the highest-earning graduates pay higher interest on their loans.
Shadow communities secretary Caroline Flint told BBC Radio 5 live that Labour was not looking to make the graduates worse off.
"What we're looking to do is find the funding so we can bring what is a £9,000 cap down to £6,000."
Asked whether the policy would definitely be in Labour's next election manifesto, Ms Flint said: "Well Ed Miliband laid out today that it's a policy he's taking forward. And therefore that's something that we'll be putting to the people."
Aides to Mr Miliband told the Observer: "This is what we would do now. But in three and a half years' time we might be able to do even more."
The president of the National Union of Students, Liam Burns, said Mr Miliband was "sorely wrong" if he believed students will back such a position at the next general election.
"If they think this is going to be a manifesto policy, then I'm sorry - this isn't going to win support of students," he said. "Going into the context of a Parliament where the majority of people promised not to increase fees at all, to simply go back to a position of 'well, we're only doubling it,' well that's not quite good enough."
But Mr Burns said if Mr Miliband's announcement referred to what should be done immediately, he would agree with him "wholeheartedly".
Liberal Democrat MP Gordon Birtwhistle said Ms Flint's plan to axe the planned cut in corporate tax showed she was "living in a complete economic fantasy world", as the companies that would be affected were potential employers of students.
"If you start increasing the corporation tax on companies, then it'll be cheaper to go to university, but there won't be any jobs to go into when they leave," he said.
The BBC's political correspondent Vicky Young said the announcement of this proposal had come as a "bit of a surprise".
She said policy reviews were being carried out across all areas for Labour so policy announcements had not been expected until further into the next session of parliament.
Our correspondent added that it was important for Labour that these sums added up as polls suggest people trust the Conservatives and the coalition government far more with the economy.
She added: "It was incredibly difficult for the Liberal Democrats - they had a promise not to introduce tuition fees which they went back on.
"Many people feel they have lost the student vote which gave them a number of seats at the general election so clearly that is what Ed Miliband is trying to do there.
"By saying how he'd pay for it, partly by not bringing in this cut in corporation tax for financial services, he can say he's making the wealthy pay more."
Andrew Harrop, from the Fabian Society think tank, said: "It's very important for Labour to regain the front foot on economic credibility.
"It's not good enough just to criticise the coalition, Labour has to have clear answers that the public and the markets can engage with."
Tuition fees were introduced by the last Labour government.
The current £9,000 maximum was introduced by the coalition government.
The Liberal Democrats have been accused by students of breaking pre-election promises not to raise tuition fees.