Purpose: The article addressed the problem of relationships between university funding and efficiency on the one hand and the quality of teaching and research on the other.

Methodology: The measurement of teaching and research quality in Polish universities was derived from two sources: 1) evaluation scores of teaching quality given to universities by the Polish Accreditation Committee, and 2) the research category grades given to university departments or units by the Polish Committee for Evaluation of Scientific Units. Subsequently, the quality measurements were correlated with financial indicators and efficiency scores obtained from data envelopment analysis.

Findings: The correlation and regression results indicated that public universities that have received higher scores of teaching quality simultaneously have higher average scientific categories. There was also a substantial relationship between the revenue per student and the revenue per teacher and variables describing quality but the regression analysis exhibited opposite directions regarding the type of quality indicator.

Research limitations/implications: The quality of teaching and research at universities was assessed despite the limited availability of internal information gathered from higher education institutions (HEIs).

Practical implications: The authorities of a university can simultaneously track the improvement of quality or financial efficiency without losing their interdependence when reforms of HEI operations are conducted.

Originality: The study proposed new measurements of quality derived from external evaluation bodies and investigated the relations of these measures with selected financial and efficiency indicators.