From The Collaborative International Dictionary of English v.0.48:

University \U`ni*ver"si*ty\, n.; pl. Universities. [OE.
   universite, L. universitas all together, the whole, the
   universe, a number of persons associated into one body, a
   society, corporation, fr. universus all together, universal:
   cf. F. universit['e]. See Universe.]
   1. The universe; the whole. [Obs.] --Dr. H. More.
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   2. An association, society, guild, or corporation, esp. one
      capable of having and acquiring property. [Obs.]
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            The universities, or corporate bodies, at Rome were
            very numerous. There were corporations of bakers,
            farmers of the revenue, scribes, and others. --Eng.
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   3. An institution organized and incorporated for the purpose
      of imparting instruction, examining students, and
      otherwise promoting education in the higher branches of
      literature, science, art, etc., empowered to confer
      degrees in the several arts and faculties, as in theology,
      law, medicine, music, etc. A university may exist without
      having any college connected with it, or it may consist of
      but one college, or it may comprise an assemblage of
      colleges established in any place, with professors for
      instructing students in the sciences and other branches of
      learning. In modern usage, a university is expected to
      have both an undergraduate division, granting bachelor's
      degrees, and a graduate division, granting master's or
      doctoral degrees, but there are some exceptions. In
      addition, a modern university typically also supports
      research by its faculty
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            The present universities of Europe were, originally,
            the greater part of them, ecclesiastical
            corporations, instituted for the education of
            churchmen . . . What was taught in the greater part
            of those universities was suitable to the end of
            their institutions, either theology or something
            that was merely preparatory to theology. --A. Smith.
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   Note: From the Roman words universitas, collegium, corpus,
         are derived the terms university, college, and
         corporation, of modern languages; and though these
         words have obtained modified significations in modern
         times, so as to be indifferently applicable to the same
         things, they all agree in retaining the fundamental
         signification of the terms, whatever may have been
         added to them. There is now no university, college, or
         corporation, which is not a juristical person in the
         sense above explained [see def. 2, above]; wherever
         these words are applied to any association of persons
         not stamped with this mark, it is an abuse of terms.
         --Eng. Cyc.
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