Simon Targett reports from a Malaysian university that is seeking a rapprochement with the western intellectual tradition. The man with the moustache stared into the tinted taxi window with forbidding menace. His dark eyes conveyed a dictionary of diehard words: jihad, fatwa and that most feared Islamic F-word -- fundamentalism. When he finally waved the taxi driver through the gates, it felt like entering another world, crossing the last frontier. But this was not the Kuwaiti border or the outskirts of Baghdad or even the Khyber Pass. This was the main entrance to the International Islamic University in Malaysia.

Set in the smart Kuala Lumpur suburb of Petaling Jaya, the university appears to be a tranquil spiritual retreat, an Islamic oasis in a desert of encroaching western materialism. As the taxi passed through the campus, a young Muslim strode to the next class, with a copy of the Koran clasped to his chest. It was a scene that, with the palm trees and the whitewashed mosque and minaret in the background, evoked a distant time, when the Saharan bedouin tribes first talked about Allah. Yet, in fact, IIU is at the vanguard of a university-based intellectual Islamic movement that is seeking a rapprochement with the west and with the modern world.

The Islamic world has long boasted distinguished centres of higher learning. Cairo's Al Azhar, commonly described as Islam's Oxbridge, was nearly 100 years old by the time William beat Harold at the Battle of Hastings. But with the rise of the west, and particularly with colonisation, these lost ground to new institutions modelled on the European concept of the secular university. According to Farhan Nizami, director of Oxford's Centre for Islamic Studies, this division of learning was a great source of social tension.

Something, therefore, had to be done -- and urgently. But what? One option was to modernise the traditional establishments. That is what Nasser did at Al Azhar in the early 1960s. But the reforms were not a great success. Cambridge scholar Akbar Ahmed contends that Al Azhar is still too traditional, offering "very little fresh thinking". The other option was to design a new type of Islamic university. A model of sorts was built in India in the late 19th century, when Sir Syed Ahmad Khan founded Aligarh, which was promoted as a "Muslim Oxford". It offered classes in Islamic studies while remaining quintessentially European.

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But the model was not developed elsewhere, and by the mid-1970s, the Islamic world still hankered after a genuine synthesis of old and new, religious and secular, Islamic and western. The newly founded Saudi Arabian institutions in Riyadh (1953) and Medina (1961) were still more like holy seminaries, and the Pakistani experiment at Bahawalpur in 1963, which was heralded as "the first Islamic university", failed to take off for lack of funds. It was for this reason that in 1977 Muslim scholars gathered in Mecca to grapple with the future of Islamic education.

They came from all corners of the Islamic world, they concluded that it was time that traditional Islamic learning and modern European learning should be properly integrated, and they talked of the Islamicisation of knowledge -- blending the basic tenets of Islamic ethics with science and technology, mathematics and philosophy, politics and economics. But this was not just about Islamic education. This was also about the future of Islam. For, to a large degree, it was Islam's intellectual isolation that had left it marginalised in a modern world of other people's making.

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One conference delegate, Mahathir Mohamad, then Malaysia's education minister and now her prime minister, was deeply moved by the proceedings. Six years later, the first students started at Petaling Jaya, in the grounds of an old Muslim college. That Malaysia should have founded one of the first new-style Islamic universities -- another was established in Islamabad under General Zia -- is not surprising.

For one thing, Islam in multicultural Malaysia is a gentle creed, having been delivered to her shores not by the proselytising sabre of conquest but by the capricious tradewinds that transported the merchant's dhow across the Indian Ocean. For another, the building of the university coincided with a period of Islamic revivalism, as the indigenous Islamic Malays -- for so long overshadowed by the colonial British and Chinese -- at last asserted their ethnicity.

Islam does not recognise a distinction between the religious and the secular, and IIU's degrees reflect this. The principal faculty or kulliyyah is called Islamic Revealed Knowledge and Human Sciences. Underpinning the whole philosophy are the concepts of tawhid -- the idea that all creation is integrated and equal in the eyes of God -- and khilafa -- the idea that the individual must approach creation as a trust from God. There is also the concept of ibadah, which holds that learning is itself an act of worship, that entering a library to read a book is like entering a mosque to pray.

Inside his conference chamber, the rector and deans of faculty, scattered around a magisterial high table, explained these ancient Islamic principles, all the while punctuating the Arabic phrases with the words "modern" and "contemporary". English professor Akran Sa'adeddin, who completed his doctorate in Edinburgh and whose throaty Americanised accent trumpeted his links with the west, said the aim was "to produce an all-rounder Muslim, one who is contemporary, contributive, conducive to progress in the world".

But in what way could the Islamic professional contribute to the advancement of modern civilisation? One is the development of a code of ethics that guides scientific experimentation -- a very hazy area in the West. The concept of khilafa negates the use of science for evil ends, which means "yes" to nuclear power but "no" to nuclear weapons. Another is the development of the built environment in a way that respects the natural world. "Our students are conscious of higher values," says engineering professor Imtiaz Ahmad. "So when they design a factory, they know that the chimney will give out smoke which affects the environment, and will take account of that."

But sometimes the arguments mobilised to give Islam the mien of modernity sound as though they are being asked to try just a little too hard. "Women covering themselves has a whole philosophy behind it," says Fadlullah Wilmot, the rector's adviser. "It means you value a woman for the person she is, and not what she looks like."Some Islamic women also articulate this philosophy, notably the thrusting Malaysian intellectuals in the group "Sisters in Islam". Even so, it seems so obviously contrived that it is unlikely to find favour in the west.

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Justification of another ancient custom relates to the training of Islamic journalists. According to Mr Wilmot the budding Islamic journalist is taught "not to go around sensationalising people's private lives", adding that "the prophet said if you can't find something good to say about a person, keep quiet".

If these examples of the IIU's Islamicised approach to life and learning jar on western ears, the university is nevertheless modern in other ways. Of the 5,000 undergraduates, some two-thirds are female (though there are few female academics), which reflects the fact that Malaysia boasts the highest percentage of university-educated women in the Islamic world. The students are taught in mixed classes, something which shocked one Jordanian scholar. He was invited to give a series of lectures at IIU, but on finding that he would be expected to teach the female students face to face, rather than via closed circuit TV, he turned down the invitation. Many foreign academics do accept such invitations, however. IIU's lecturers are drawn from nearly 40 countries, which inevitably means the IIU is not reclusive but receptive to outside influence.

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This can create problems. "One girl came up to me and said: 'you ask so many difficult questions but you don't give the answers'," Cambridge-educated Shabbir Akhtar, a lecturer in Islamic studies, reveals. "I said: 'what makes you think I know all the answers?' She said: 'If you don't know the answers why are you a professor?' Professors are held in great respect here." But the international dimension does mean higher academic standards. Akbar Ahmed considers IIU "one of the best Islamic universities", and Judith Nagata, professor of anthropology at York University in Toronto and a seasoned observer of Malaysian Islam, says IIU can "hold its head up high".

Academically the university has achieved a measure of international respectability. But has it really achieved a synthesis of East and West? Not entirely. In social terms, there is still a wide gulf. When former IIU student Nik Nuzrul Thani arrived in London to study business law at the School of Oriental and African Studies -- on recent evidence hardly the most unIslamic of British colleges -- he was "shocked" by the liberal atmosphere, by the political clubs. In academic terms, there is a tendency towards chippiness, saying that a synthesis is not the same as a sell-out. Prime minister Mahathir speaks for many when he says: "Western or secular education is neither western nor secular. The education and knowledge that the west has and that the western people have spread throughout the world are in reality Islamic."

In one sense, this is historically correct. During the Middle Ages, Spanish Arabs were pre-eminent in astrology, astronomy, mathematics and medicine, and they served as a conduit of classical antiquity, relaying the works of Ptolemy, Aristotle and Hippocrates. But, as Ahmed says: "The problem is that some scholars are intoxicated by what was achieved a thousand years ago, and they think 'yippee, I'm the best, I don't have to develop'." As evidence, he cites the example of one sociologist who wrote an essay that ludicrously claimed to have "upturned every western thinker from Durkheim to Max Weber."

Of course, the idea that Islam and the West could heal the wounds of a millennium of separate development overnight is questionable. This is a multi-generational endeavour. But if it is going to happen, the new Islamic universities are likely to be where it will happen first, and the IIU is better placed than most to be around when it does. In Islamabad, the Islamic university has financial troubles and faces an uncertain future.

By contrast, IIU is backed by, among others, oil-rich Saudi Arabia. That does not mean there are no worries. The Saudis themselves are not so wealthy as they once were. According to Oxford Arabist Michael Gilsenan: "Ever since the Gulf War, the Saudis have not had a bottomless pit of gold coins." And as holder of the Khalid bin Abdullah al Saud professorship, he should know. Also, the Islamic revival in Malaysia seems to have peaked, a fact made obvious by the recent banishment of the Al Arqam sect.

Even so, expansion is in the air. Next year, IIU is moving to a new Pounds 300-million campus at Gombak in the hills surrounding Kuala Lumpur, where its student population will increase to 15,000, three times its present size. It could be there, many years hence, that Islamic scholars at last find what Nagata calls "the best of both worlds".

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