(this is a large pdf document: http://pvspade.com/Logic/docs/Survey%202%20Interim.pdf)
Universities grew out of cathedral schools. An important cathedral school drew students from all over Europe. Such a school became known as a studium generale. Some of these studia generalia survived and became known as "universities". At first, the term `universitas' referred to the "entirety" or "universality" of the faculty and students. As the term gradually came to be used, a "university" was one of these major, international schools that was distinguished from others by its possessing an official charter (granted by the king or by the Church), a set of statutes, and an established form of governing itself. The University of Paris was the premier university in Europe in the thirteenth century. Its statutes were officially approved by Robert de Couridcon, the papal legate, in 1215. The official founding of the University is usually put at this date, although it is clear that the statutes existed earlier. Oxford and Cambridge also date from the early-thirteenth century, although their period of greatest vigor came in the late-thirteenth and early-fourteenth century. Toulouse was founded in 1229 by papal charter. Salamanca was founded by royal charter in 1200. There were also universities in Italy - indeed, Bologna was the first university in Europe. (Bologna had the peculiarity of being a student-run university.)
Universities were divided into "faculties". The four most common ones were the faculties of arts, law, medicine and theology. Most universities had arts faculties, in addition to one or more of the others. The arts faculty was for the basic training of students, before they proceeded to one of the "higher" faculties. Bologna was primarily a law-university. Others were primarily for medicine. Paris had all four faculties. At Paris, theology was considered the highest of the four. You were quite a somebody if you succeeded in getting a doctorate in theology at Paris. Students started in the University much earlier than is the custom today - around fourteen or fifteen years of age. They studied in the arts faculty for six years. Although this turn in the arts faculty was in theory supposed to ground the student in all the "liberal arts", it in fact was mostly concerned with the arts of grammar and logic - particularly Aristotle, of course. The study of literature had practically disappeared. During this six year stint, a student could become a "bachelor" (the origin of our "bachelor's degree"), which entitled him to perform certain teaching tasks of a menial nature. After his training, he could become a "master", but not before he was twenty. The masters were the teachers in the arts faculty. One who was awarded a master's chair was obliged to teach actively for a period of time (some two years) before he left it to enter one of the "higher" faculties - which he almost always did. There were very few career-masters in the faculty of arts. One of the conspicuous exceptions in the fourteenth century was John Buridan, who taught in the arts faculty at Paris for some forty years or so. There was, on the whole, a constant turnover in the teaching staff of the faculty of arts.
After fulfilling his obligations as a Master of Arts, a student could proceed to one of the other faculties. If he went into theology, his training lasted for another eight years, a period which was later made even longer. Four years were spent on the Bible, and another two commenting on Peter Lombard's Sentences, a standard textbook compiled in the twelfth century, and consisting of a compilation of texts from the Church Fathers (especially Augustine) on various matters. ... After these six years, the student became a "bachelor" of theology (as distinct from a bachelor of arts, of course), lectured for two years on the Bible and another year on the Sentences. After another four or five years he could become a master or doctor of theology - if he still had the energy and was not yet in his dotage. All these regulations were of course constantly being changed, but this is enough to give you the general idea.
When the newly translated works of Aristotle first appeared at the University of Paris, it was in the faculty of arts. The works were clearly not law or medicine (some of them might be stretched a bit to count as medicine, but they were not the ones that were influential first), and they were not theology in the traditional sense of "Sacred Doctrine", although of course some of Aristotle's writings had theological consequences. Some of these consequences were thought to be dangerous and heretical (and they were). So in 1210, a provincial synod at Paris ruled that Aristotle's "natural theology" could not be "read" in the faculty of arts at Paris. To "read" here means to "lecture on", either in public or in private tutorials. It doesn't mean that students and masters couldn't study these works in the privacy of their own chambers. In 1215, when Robert de Couridcon approved the statutes of the University of Paris, there was a statute forbidding the arts professors from lecturing on Aristotelian metaphysics and natural science, or "summaries" of them (this probably refers to Avicenna's "compendia" of Aristotle, since it was far too early for Averroes to have been meant). In 1231, Pope Gregory IX ordered that the works prohibited in 1210 not be used until they could be examined by a theological commission to remove any errors. In 1245, Innocent IV extended the prohibitions of 1210 and 1215 to the University of Toulouse. Oxford was never affected by this ban. For that matter, neither was Paris, really. By the 1250s, people were openly lecturing on everything they had of Aristotle's.
Why were these prohibitions issued? In part it was out of a genuine concern for the purity of the faith. Aristotelianism was thought, and rightly so, to be theologically suspect. And remember, people were just getting acquainted with Aristotle. They weren't altogether sure yet just what he meant and just what the implications were. The Church authorities, and the people in the faculty of theology, didn't want the teenagers in the faculty of arts to get all carried away with this new philosophical pagan - at least not until the theologians had had a chance to think about it a bit for themselves, and to assimilate it.
That's the good part, the genuine concern for the "care of souls". But there was also a great deal of just plain jealousy involved too. A popular arts master who gave exciting lectures on this new philosophical daredevil, Aristotle, was likely to find his wings clipped by the higher-ups in the University hierarchy. Keep the basic ideas of this University structure in mind when we get to the extremely important Condemnation of 1277 - coming soon to this theater.