The aim of this study was to examine the relationship between alcohol use and psychological well-being among undergraduates of a Nigerian tertiary institution. The objectives included determining the prevalence and pattern of problematic alcohol use and ascertaining the association between alcohol use and some sociodemographic variables.The Alcohol Use Disorders Identification Test (AUDIT) was used to evaluate for alcohol-related problems in 443 students of a university in southwestern Nigeria. A questionnaire was also used to obtain data on sociodemographic variables while psychological well-being was assessed with the General Health Questionnaire-28.The prevalence of alcohol use was 40.6% while alcohol-related problems were found in 14.9% of the students using the AUDIT questionnaire with a cutoff score of 5. Heavy episodic alcohol use was reported by 31.1% while alcohol-related injury had occurred in 8.9% of the students. Male gender (χ2=4.54; P.05), older age (χ2=3.92; P.05) and higher paternal education (χ2=4.40; P.05) were associated with problem drinking. In addition, psychological distress was significantly associated with heavy episodic drinking (χ2=9.58; P.05) and history of alcohol-related injury (χ2=3.96; P.05).The significant relationship between hazardous drinking and mental ill health among undergraduates in the institution suggests the need for integrating mental health services in screening, brief intervention and referral to treatment services in Nigerian university settings.