The increase from 54 funded places for domestic students to 60 places a year came into effect this year, vice-chancellor Prof Harlene Hayne announced in university council papers released this week.
The additional students were tagged for ''rural origin students'', mirroring a similar provision in the university's medical admissions to address health shortages.
Pro-vice-chancellor health sciences Prof Peter Crampton said the Government agreeing to increase the domestic cap last December was good news for both oral health in New Zealand and the school of dentistry.
''It's fantastic news. I mean, we are the sole provider of dental education in New Zealand, so all the domestically trained dentists come through Otago.''
''The evidence internationally is that students from rural backgrounds are more likely to end up having some or all of their careers back in rural areas.''
It was the first time the number of funded places had been increased since 1961, and the number had been reduced in 1984, he said.
The university had made a number of unsuccessful approaches to the Government for more places, so it was ''very happy that this approach was successful''.
Prof Hayne pointed out the dental cap was one of three subject areas directly determined for universities by the Government. The others were for undergraduate medical admissions and veterinary science.
