AbstractEntrepreneurship is a powerful tool that reduces unemployment, boosts economic growth, and promotes innovation and social change. With a focus on the promotion of entrepreneurial intention possessed by higher education institutions offering entrepreneurship education, this study assesses the indirect impact of higher education institutions in developing entrepreneurial intention through passion as a mediator. It also investigates the moderating role of individual differences and innovativeness between the entrepreneurship education in higher education institution and the entrepreneurship educational outcome, namely entrepreneurial intention. Also, the moderated mediation relationship between entrepreneurship education in a higher education institution and entrepreneurial intention is assessed. To conduct the cross‐sectional study, data was collected from 636 students perusing an entrepreneurship course at colleges affiliated with Bharathiar University in Coimbatore, Tamil Nadu (India). A questionnaire with 37 items is used to collect the data as ratings from respondents. The moderated mediation model is designed and tested using the bootstrapping method in the Hayes PROCESS macro model. According to the findings, the association between entrepreneurship education in higher education institutions and passion is negatively moderated by individual differences and innovativeness. Further, the study revealed that the combined effect of the higher education institution, individual differences, and innovativeness on entrepreneurial intention is mediated by passion. Context and implicationsRationale for this studyThis empirical research aimed to assess the impact of higher education institutions and the effect of passion, individual differences, and innovativeness in developing the entrepreneurial intention to support the educational experience of higher education institutions offering entrepreneurship education.Why the new findings matterThe findings of the study indicate that higher education institutions promote entrepreneurial intention through quality content, instructors, and an entrepreneurial environment that considers individual differences. However, controlled environments can negatively impact innovative students' entrepreneurial intentions, as learning passion indirectly influences entrepreneurial intentions.Implications for EducatorsThe educational institutions must provide a distinct entrepreneurial environment for students pursuing entrepreneurship programmes. Collaborative learning should be adopted to create huge differences in the skills, attitudes, and confidence levels of the students and to assess individual competence and team effort. Low or average‐skilled students can be motivated and encouraged to participate in entrepreneurial events inside and outside the institution, whereas highly competent students can be provided with real‐world business opportunities to launch new ventures, which may inspire and drive their peers.