In Latin America private universities are a recent phenomenon; Uruguay began its experiment with privatization only 15 years ago. This study explores several factors which have impeded formation of private universities by analyzing the "failures" of three institutions. The theoretical framework of the study is based on work by D.C. Levy (1986), who cited five necessary conditions for privatization of universities in Latin America: freedom, choice, equity, effectiveness, and usefulness to the state. The first institution cited, the Centro de Estudios Universitarios, formed by Christian missionaries in 1993, lacked institutional autonomy and was denied official recognition. The university failed when it lost faculty through missionary reassignment and was unable to attract students because of government impediments to advertising. The second institution, the University of Maryland-Montevideo, operated from 1992-98. Its failure resulted from a poorly designed academic calendar, high student costs, and the requirement that students had to be proficient in English. The third institution, the Instituto de Economia de Montevideo, which provided postsecondary training for economists and bankers from 1990-98, fulfilled none of the conditions cited by Levy; however when other institutions began to copy its offerings, its survival was threatened. It continues to teach economics courses, but has become part of a nonprofit foundation. (Contains 12 references.) (CH)