The new law, if signed by Hungarian President Janos Ader, will require an global treaty with the government of the home country of a foreign university that operates in Hungary.
The demonstration was the biggest since 2014 when protesters opposed Orban's right-wing government over a tax on internet usage, which was later withdrawn.
Prime Minister Viktor Orban considers Soros an ideological foe whose "open society" ideals contrast with Orban's plan to make Hungary an "illiberal state".
The Hungarian-born Soros founded the English-language CEU in 1991 aiming at helping the region's transition from communism to democracy. Protesters filling Kossuth Square outside Parliament chanted "Don't sign it, Jani", using a Hungarian nickname for Ader's first name. VETO. Free country, free university! Amendments to Hungary's higher-education law approved this month could force it to close or move.
They will also be required to have a campus and faculties in their home country - conditions not met by the CEU, which is registered in the United States.
Hungary's president late on Monday ( April 10) signed legislation on foreign universities that could force a top worldwide school founded by U.S. financier George Soros out of the country, triggering a fresh protest in Budapest against the move. "The autonomy of universities, whether it's in Hungary registered, working university, foreign university, it is stated in the constitution that university autonomy should not be. can not be hurt: So the government has no such target". The university now enrolls over 1,400 students from 108 countries.
Budapest's Central European University has said it will use legal channels to fight on against the government's move, which requires the institution to obtain a new agreement between the U.S. and Hungarian authorities to enshrine its status.
Orban, who faces elections in 2018, is not expected to backtrack on the legislation as it constitutes a major plank of his political strategy defending national interests against what his government calls foreign meddling in Hungarian affairs.
The US State Department has expressed its concerns about the legislation and the CEU's ability to continue operating in Hungary.
Orban has said he is prepared "to negotiate with the United States" on the future of the university which has until January to conform with the new law.
Ader said in a statement that the bill setting new conditions for foreign universities in Hungary was in line with the Constitution and did not infringe upon academic freedoms.
Opposition parties were quick to criticize Ader, a Fidesz politician who was re-elected by lawmakers to a five-year term in March.
A law expected to be passed in May would force nongovernmental organizations getting more than $24,500 a year from overseas to register with authorities.