Culture Minister Fiona Hyslop stated in a speech at Edinburgh University that greater freedom for Scotland over immigration is needed to enable Scotland to bring in more skilled workers and students.
She also said that the UK Government's plans to permanently cap the number of people immigrating to the UK would damage its ability to attract top talent from overseas.
The Scottish Government wants its own annual immigration allowance distinct from the UK Government national immigration cap.
"Scotland welcomes talented individuals to work, live, learn and remain," Hyslop said. "The UK Government is projecting a totally different message. Its plan for a cap on immigration is based on an ideology that ignores the quite different reality here in Scotland."
She said that rather than limiting the size of the population, Scotland needs to increase it to achieve sustainable economic growth. She stated that skilled immigration in particular is "vital" for Scotland's high-growth sectors such as life sciences, renewable energy, creative arts, and education.
"I am deeply concerned about the effect that the annual limit will have," she said. "It will hit small businesses particularly hard. It will impact negatively on investment and on tax revenues from the high-earning immigrants that will be targeted. It also has the potential to have a serious impact on the ability of our universities and colleges to recruit talented individuals."
"The immigration cap is not right for business, economic growth, our colleges and universities, and it is not right for Scotland."