Mining billionaire Andrew "Twiggy" Forrest has made one of the biggest single philanthropic donations in Australian history, and called on other tycoons to share their wealth.

Mr Forrest will contribute $65 million to higher education in Western Australia.

The money will be used to establish a $50 million scholarship foundation for WA's five universities, as well as building a new residential college at the University of WA.

The donation will be formally announced at a gala dinner in Perth tonight to be attended by Prime Minister Tony Abbott and West Australian Premier Colin Barnett.

Philanthropy Australia chief executive Louise Walsh confirmed Mr Forrest's donation was "certainly the biggest single cash gift in Australian history by an Australian".

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Among the largest previous donations was the $102.5 million handed to three Queensland institutions by Irish-American philanthropist Chuck Feeney in 2009.

Mr Forrest is the chairman of WA mining company Fortescue Metals Group and was recently appointed as the head of a government review into Indigenous training and job programs.

He says he wants the money to attract some of the best minds in the world to West Australian universities.

"I expect this to be one of the best, if not the best, investments we ever make," Mr Forrest told AM.

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"I'd like to see the University of Western Australia and the other four or five universities in Western Australia really excel through having some of the greatest minds in the world attracted to it.

Mr Forrest says he and his family made the decision a while ago.

"It was one (decision) reached a long, long time ago when we began to become more wealthy than what we needed," he said.

"We sat the kids down and asked where they would like to go with this wealth.

"And we said, 'Look, you will always feel a satisfaction in a much, much greater sense if you get out there and do it yourself'.

"The kids really took a view with (wife) Nicola and myself that they were happy for us to work in the most productive way possible to make the hard-won capital which we've accumulated put to the very best use we can to advance the human cause.

"And this is just part of that process."

Mr Forrest says he wants to encourage others to give more generously.

Sorry, this video has expired Giving West chief sees philanthropy growing in WA ( Andrew O'Connor )

"Wealthy people in Australia tend to give, and give very quietly," he said.

"That is wonderful that they do that, but if they actually give and let people know that, it acts as an inspiration.

"I don't see why, if you look at how the Australian culture and psyche is, that we can't be amongst the most generous, from the grassroots up, nations in the world."

Giving West chairman John Poynton says the donation is unprecedented and another step towards improving the state's philanthropic record.

"We have obviously got a long way to go to match what happens internationally, but we do think we're right on the way," he said.

Mr Forrest's wealth was valued at $3.66 billion by magazine BRW in May, putting him ninth on a list of the country's richest people.