The increasing demand of Chinese students wanting degrees from US schools is prompting US universities to set up branch campuses in China.

Prominent universities such as NYU, Duke and UC-Berkeley have established campuses in Shanghai, Kunshan and Shenzhen in partnership with Chinese universities.

The University of California (UC) is exploring more opportunities to bridge the US and Chinese markets.

The world's second-largest economy also contributes the largest number of international students to the university, Christine Gulbranson, senior vice-president at UC's office of innovation and entrepreneurship, told CNBC in a recent interview.

In 2016, nearly 20,000 students from China enrolled in the university, almost 10 times more than in 2000.

Thousands of UC alumni are currently in China, one of UC's most robust alumni locations, and the university is looking at how to engage with the market, she added.

So far, 38 overseas institutions have set up branch campuses on the Chinese mainland, and 14 of them are from the US, according to data gathered by the Cross-Border Education Research Team (C-Bert) at the State University of New York at Albany in January 2017.

US institutions have the highest number of campuses, followed by the United Kingdom with eight and France with three.

"The US has many reputed universities and the Chinese students have a strong desire to study in the US. To them, it's convenient and cost-effective to acquire a US degree without studying abroad," said Yenbo Wu, associate vice-president of international education at San Francisco State University.

According to C-Bert, Johns Hopkins School of Advanced International Studies and Fort Hays State University were the first US institutions to set up campuses in China. Hopkins -Nanjing Center for Chinese and American Studies and Sias International University (Henan) were founded in 2000.

The most recent - Georgia Tech Tianjin University Shenzhen and Tianjin Juilliard School - are still under development.

The Chinese government has been encouraging the partnership in the hope of introducing the excellent overseas educational resources to enhance its own academic and research levels, said Wu.

Most of the campuses offer smaller graduate programs in focused areas. Duke Kunshan University, for example, has particular interest in chronic disease and environmental and global Health. Tsinghua-UC Berkeley Shenzhen Institute focuses on information technology and data science, as well as precision medicine and healthcare.

Innovation has become a national strategy of China, and interdisciplinary education with US-China partnership is a win-win achievement for both countries, said Zhu Xuehua, science and technology counselor of the Chinese Consulate General in San Francisco.

"It's good for the universities to take an international approach, which can help build up their reputation and research capabilities. The faculty, students and even communities will benefit from it," said Wu.