"The money has got to come from somewhere," said UCLA student Sarah Sherwood. "If it's not coming from us in-state students, and out-of-state students can pay more, then maybe that will help us in-state students."
Some in-state students worry it could make it more difficult to get in and to register for classes.
"They're going to favor them over us and it's just more people to choose classes from. It will be harder to get your classes," said student Bowen Wang.
UC officials said they intend to have enough space for qualified California students, but there simply isn't enough funding from Sacramento.
A statement on the UC website said: "We cannot ignore the fact that without additional funding from the state, campuses will not be able to accommodate all of the increased demand."
That means some students have to go elsewhere.
"For the class that entered last fall, we saw a big increase in applications from within the state of California," said Loyola Marymount University Director of Admissions Matthew Fissinger.
LMU said incoming freshmen mention the changes at the UC system as one reason they're attending other universities.
"Clearly the concern about the public system in general and enrollment opportunities at the University of California are on their mind," Fissinger said.
UC officials said they still don't know what the final enrollment numbers will be. Students won't begin to receive their acceptance until the spring.