In the last two decades, India has witnessed the establishment of a large number of private universities. While these institutions are spread across different parts of the country, one can observe certain locational patterns. Focused particularly on private universities legislated by state governments (as opposed to private deemed universities legislated by central government), this article examines the significance of anticipated demand and state regulatory frameworks in attempting to understand how private capital and state engage with the question of location of universities. This article is largely based on an analysis of data generated by University Grants Commission and All India Survey of Higher Education. It argues that while locational decisions of private universities are influenced by anticipated demand, state governments are often using careful customisation of regulatory frameworks as an instrument to facilitate the development of private capital in higher education.