London has four universities in the top 40 of a global league table - more than any other individual city - although only one makes the top 10.
US universities are still the most dominant international force in the Times Higher Education rankings.
In top place, as last year, is the California Institute of Technology.
In the UK there are concerns that, outside Oxford, Cambridge and London colleges, many major universities are slipping down international rankings.
The so-called "golden triangle" of UK universities - Oxford, Cambridge and leading London institutions - is seen as a breakaway elite group, with these universities consolidating their international reputations.
Imperial College, University College London, LSE and King's College London are all in the top 40. London has more universities in this league table than all of Japan, although only Imperial College makes the top 10.
Clusters of excellence
Phil Baty, editor of the rankings, says this is part of a global pattern of clustering of "excellent universities". Boston in the US has eight universities in the top 200, more than entire countries such as China, Switzerland and Australia.
But there are warnings from the rankings organisation that prominent UK regional universities are falling away.
Edinburgh, Manchester, Bristol, Sheffield, Warwick, Southampton, Nottingham and Newcastle are all seen as going downwards against international rivals.
However the University of Leicester has risen sharply, which has been described as the "Richard III effect", after the high-profile research associated with the discovery of the body of the medieval king.
This is described by the Times Higher Education rankings as showing that "power is draining from the UK regions".
The top 20 still reflects the dominance of wealthy US university powerhouses, taking 15 of the top 20 places, with institutions such Harvard, MIT and Stanford in the leading pack behind the California Institute of Technology.
The highest UK university is Oxford and the highest ranked continental European university is ETH Zurich in Switzerland, which is also the only non-English speaking university in the top 20.
"No university can rest on its laurels. No-one is guaranteed to retain a top-200 place when the US, Far East and others are investing in research so heavily," said Sir David Bell, vice-chancellor of Reading University, which has fallen from 176th to 194th place.
"There are some dramatic year-on-year rises and falls this year, so we should be careful not to read too much into a single set of figures."
"It is no surprise that a small number of UK universities at the very top end will remain more stable, with others more likely to fluctuate."
Sir Christopher Snowden, president of Universities UK, said the rankings showed that the UK had "the second-strongest university system in the world after the US".
"What is clear, however, is that the UK must continue to invest in higher education if we are to maintain this global competitiveness."