Integrating artificial intelligence (AI) into higher education has become a transformative force, offering innovations such as personalized learning, automated administrative tasks, and advanced data analytics. However, its rapid adoption raises critical questions about ethics, equity, and long-term sustainability in academic institutions. This bibliometric study examines the evolving discourse on AI in higher education, focusing on its implications for sustainable development, particularly in alignment with the United Nations Sustainable Development Goals (SDGs), including quality education (SDG 4), reduced inequalities (SDG 10), and global partnerships (SDG 17). The study analyzed 1803 peer-reviewed publications from the Web of Science and Scopus databases (2018–2024), using Bibliometrix® to map trends, key themes, and geographic contributions. The findings reveal a dramatic surge in research output, from fewer than 100 publications in 2018 to over 600 by 2024, reflecting heightened academic and institutional interest. Leading applications of AI in higher education include adaptive learning systems, predictive analytics for student performance, and AI-driven chatbots for student support. These tools promise to enhance educational accessibility and efficiency. Nevertheless, they also introduce challenges such as algorithmic bias, data privacy concerns, and risks to academic integrity issues prominently highlighted in highly cited works by Rudolph et al. (J Appl Learn Teach 6(1):342–363, 2023a; J Appl Learn Teach 6(1), 2023b) and Cotton et al. (Innov Educ Teach Int 61:228–239, 2024). Geographically, research production is uneven, with China (412 publications) and the United States (277) dominating the field, while contributions from the Global South remain limited. This disparity underscores the need for inclusive collaboration to ensure AI benefits are equitably distributed. The Astrophysical Journal and Education Sciences emerged as key sources, illustrating the interdisciplinary nature of AI research, spanning education, technology, and ethics. From a sustainability perspective, AI holds significant potential to advance SDG 4 by personalizing education and improving learning outcomes, particularly for underserved populations. If we prioritize ethical and equitable deployment, it also supports SDG 10 by bridging gaps in educational access. However, realizing these benefits requires robust frameworks for teacher training, transparent AI governance, and policies that address digital divides. This study contributes to the literature by synthesizing global research trends and highlighting actionable insights for universities. It calls for a balanced approach to AI integration that harnesses its transformative potential while mitigating risks through ethical guidelines, cross-border partnerships, and inclusive innovation. By doing so, higher education institutions can position AI as a catalyst for sustainable development, ensuring that technological progress aligns with the broader goals of equity and social responsibility.