Central Queensland University (CQU) is progressing toward a policy whereby all course materials will only be available online from 2013. The assumption by decision-makers within CQU is that current and potential students are comfortable enough with the use of technology that they will accept all their course materials being delivered online. This paper reports on a study which investigated university students’ and potential university students’ expectations of online learning. Analysis of the responses determined that there is a disconnect between the expectations of current and potential students and the policy direction that CQU has decided to embrace with respect to moving all course materials online. Pedagogical issues are examined and suggestions are provided on how to address those issues. Given the desire to match policy and reality this study outlines some of the new roles for instructors and learners that are needed to reduce the transactional distance in an increasingly online higher education environment.