EU students applying for a place at English universities for the next academic year will be eligible for loans and grants, ministers have said.
And these students' loans and grants will be available for the duration of their degree course.
The arrangement will be honoured even if the UK exits the EU in that period.
Universities said the announcement gave the higher education sector much-needed clarity on the matter and must be communicated to European students.
The government's guarantee means EU students applying to study from 2017-18 will be able to access the same funding and support they are now.
Ministers say the move will help give universities and colleges certainty over future funding.
Shortly after the EU referendum result in June, the government gave a guarantee that students currently in higher or further education - and those applying for a place this academic year (2016-17) - would continue to be able to access student funding support.
Universities Minister Jo Johnson said: "We know that the result of the referendum brought with it some uncertainties for our higher education sector.
"International students make an important contribution to our world class universities, and we want that to continue.
"This latest assurance that students applying to study next year will not only be eligible to apply for student funding under current terms, but will have their eligibility maintained throughout the duration of their course, will provide important stability for both universities and students."
Universities UK president Dame Julia Goodfellow said the news provided much-needed clarity.
"Every effort must now be made to ensure that this announcement is communicated effectively to prospective students across Europe," she said.
"European and international students are a valuable part of cultural and academic life on British university campuses and play an important role in UK towns and cities, creating jobs and supporting local businesses.
"Looking ahead, as the government develops plans [for] post-Brexit Britain, a commitment is needed to ensure that students, from Europe and beyond, are able to continue to come to the UK to study without unnecessary bureaucratic burdens."
Dame Julia said she hoped the announcement would be followed shortly by similar reassurances from governments in Scotland, Wales and Northern Ireland.
The University and College Union said it was pleased the government had clarified the situation for EU students and and hoped the devolved nations would soon follow suit.