Although educational systems around the world are emphasizing four-year university programs, there is no denying the huge importance of tertiary short-course education in driving economic development in Malaysia. In order for Malaysia to achieve developed nation status by 2020, industrial workers need to be more skilled and knowledgeable than ever before. Most short-course programs in the public sector are provided by the non-university sector, namely polytechnics and community colleges. This study, therefore, examines trends and the development of polytechnics and community colleges in Malaysia. The needs for these non-university institutions are also discussed as both institutions have a major role to fulfil the high demand for semi-skilled middle-level workers. They provide training that is essential for the service and manufacturing industries. In addition to their significant contribution to the economy, polytechnics and community colleges also create opportunities for social mobility. With less strict entry requirements, flexible study options and lower tuition fees, they open many doors for students regardless of their background, income, or secondary school achievement. These indirectly portray an element of social responsibility towards the community by providing educational opportunities for everyone regardless of background and socio-economic status. However, the benefits of graduating from technical and vocational tertiary institutions are questionable. Several issues within technical and vocational tertiary education in Malaysia are identified.