The aim of the research is to study the phenomena of internationalization of higher education on the example of educational cooperation of Petrozavodsk State University (The Russian Federation) with the University of Eastern Finland (Finland). The study relies on the conceptual framework of internationalization developed by J. Knight and H. de Wit. The case study is designed based on a qualitative methodology. It provides a content analysis of policy documents, scholarly articles that explore educational cooperation, materials of the fund of the Museum of PetrSU’s history as well as of the interviews with the experts in the field. The dominant source of data are semi-structured interviews. In total, 18 professionals involved in educational cooperation of partner-universities (both academic and administrative staff) were interviewed. The examination of the Russian policy documents and practices showed that the main rationales for internationalization are political and economic ones. The study has also found out that the most serious challenges of internationalization at national level are the lack of a legal regulatory framework corresponding to modern reality as well as the strengthening of the vertical of power in the field of higher education. As for the institutional level, the study reviews the historical phases of cooperation first. The research traces how the formats of cooperation were gradually becoming more complex. It argues that educational cooperation of PetrSU with the UEF has passed several stages starting from an ‘introductory’ period in 1970s when the only forms of cooperation were literature exchange, exchanges of professors and rectors up to project-oriented collaboration and cooperation on a multilateral basis (network cooperation) since mid-2000s. The rationales for internationalization at the institutional level have shifted over time. In 1975-1985 the dominant rationales for internationalization were political and cultural ones, in the period of Perestroika and post-Perestroika the academic and economic rationales were of great importance, while in mid-2000 and at present time academic rationales are the main motives of internationalization. Besides, since mutual interest in interuniversity cooperation is gradually declining, the study seeks to define the main challenges of educational cooperation. It reveals that the majority of challenges (dominance of one-way student academic mobility because of lack of courses taught in English, poor foreign language skills of students and university staff, poor development of distant learning opportunities, lack of young teaching staff, etc.) are of internal nature which means that intra-university changes could contribute to the transition of cooperation to a qualitatively new level of development. Therefore, the author of the study recommends PetrSU to pay more attention to internal internationalization in order to overcome the challenges of the ‘internationalization abroad’ and, consequently, to improve international cooperation with the University of Eastern Finland. Results identified in the study can be used by practitioners involved in international educational cooperation and by those who are interested in educational cooperation in a scientific term.