Up to £750,000 has been made available for bursaries and loans for 500 people in Scotland to study in Denmark, Sweden, The Netherlands and Germany.
The two-year pilot is “the first time any UK students have been offered help with European study”.
Young students with a household income of less than £16,990 will be eligible for a £1,750 bursary and a £5,500 loan for a year’s study, with a sliding scale of bursaries depending on household income.
Mr Russell said: “We already pay tuition fees and provide the best package of support in the UK for Scottish students who study at home.
“This pilot will give Scots who wish to study in Europe a chance to benefit from support and is a first for UK students, showing how decisions taken in Scotland benefit Scots.
“Living, studying and working in another country can offer young people a chance to develop new skills and experience that will be attractive to employers. That is why it is great news that more Scots will be able to reap the benefits of attending a European university.
“We will be monitoring the success and uptake of this pilot with a view to extending the range of options available for Scots looking to study in Europe and continue to make decisions that are right for Scots and right for the Scottish economy.”
Catriona O’Sullivan, from Edinburgh, is studying liberal arts and sciences with a major in philosophy and society at University College in Maastricht, Netherlands.
She said: “I could not afford this option at all without the many hours I put into my side job and if I had had the opportunity to apply for funding from the Scottish Government when I began my course, I would have jumped at the chance.”