This paper explores the changing spatialities of education in response to processes of internationalisation, through the lens of transnational education (TNE). It argues that rather than producing outward‐looking education, international credentials are becoming ‘domesticated’ – that is, they form an indistinguishable feature of existing local education systems. The paper explores the importance of discourses of meritocracy and the production of value (suzhi) in East Asian societies and how TNE fits into a wider ideological system of biopolitical governance, for which examinations represent a key technology. It demonstrates, through data collected from interviews with students in Hong Kong, the ways in which young people have internalised their own identities as failures and argues that studying for a transnational qualification serves only to accentuate this subject positioning. We also uncover some counter‐narratives to dominant discourses, or examples of ‘biopolitics from below’, where nascent political identities were expressed by some individuals. These exceptions offered some exciting possibilities for an alternative existence – such that the majority of young people, as well as a more privileged minority, are able to escape the damaging classification imposed by the pathologising of educational failure. The paper concludes with some reflections on why a more expansive definition of international education is now required, one that not only takes account of the spatial extension that occurs through internationalisation, but is also sensitive to domestication, and the profound ways in which foreign credentials are being enlisted in wider governance projects within their host communities.