Manchester University is to give £3 million to its Centre for Jewish Studies in an attempt to help the centre ease interfaith tension.
The centre, which has previously relied mainly on external grants, said the money would bolster research and undergraduate courses on Muslim, Jewish and Christian relations and Middle Eastern history.
Centre co-director Professor Philip Alexander said the move was a positive response to the attack on former Israeli deputy ambassador Talya Lador-Fresher by pro-Palestinian activists during her visit to the university in April.
Critics have attacked a report into University College London's approach to tackling campus extremism as "complacent" and a "whitewash".
An investigation was launched at UCL following former student Umar Farouk Abdulmutallab's arrest last December after he allegedly attempted to blow up a plane flying from Europe to Detroit. Abdulmutallab studied at UCL between 2005 and 2008 and was president of its Islamic Society. He is currently in the US awaiting trial.
CST said the inquiry, which considered whether students are exposed to extremist ideology, was "shallow, complacent and self-serving".