The problem of psychiatric morbidity and study difficulty among University students is important because the subsequent impairment of the student’s capacity for study may invariably lead to the termination of his or her studies. Various works, as reviewed in the literature, have confirmed this. The general aim of this work is to determine the extent to which psychiatric morbidity and study difficulty are interrelated in undergraduate students of the University of Benin and the socio-demographic factors associated with the relationship. The study was carried out among undergraduate students of the University of Benin drawn from 7 of the 14 Faculties in the University. The design of the study was cross-sectional. The study instrument consisted of the 28- item version of the General Health Questionnaire (GHQ-28), the University College London Study Difficulty Questionnaire (UCLSQ), an instrument for measuring study difficulty, and a Section on Socio-Demographic Variables. A total of 1,125 students were selected from 7 Faculties by stratified random sampling. The questionnaires of 1,060 respondents were analysed. The prevalence of psychiatric morbidity was 33.5%. The extent of interrelation of psychiatric morbidity and study difficulty as well as associated psychosocial variables was also determined. 4.5% - 15.3% of respondents had study difficulty (scores of > 75th percentile) across all aspects of study difficulty. The association between psychiatric morbidity and study difficulty was positive and significant. Study difficulty was associated with psychiatric morbidity in 13.1% – 45.9% of cases. Psychiatric morbidity/study difficulty had positive and significant association with sex, financial difficulty, academic performance of the student and course of study. The findings of this study showed that the problem of psychiatric morbidity and study difficulty among undergraduates is of great magnitude. In order to prevent student wastage, urgent and lasting intervention by way of effective mental health care services at all levels of education is necessary.