Maladaptive daydreaming is a psychological condition characterized by excessive, vivid, and immersive fantasy that interferes with daily life. It is becoming a growing concern, especially among students whose academic activities and mental health are often affected. Consequently, this study set out to empirically examine the impact of Maladaptive Daydreaming (MD) on students’ mental health in University of Nigeria, Nsukka (UNN). Specifically, the study determined, among others, to investigate whether students of UNN experience MD and how it influences their academic activities. The study population was 35,908, while the sample size 200. Cross-sectional sample survey research design was adopted for the study. Employing both multistage and simple random sampling techniques, four (4) faculties and eight (8) departments were chosen for the study, while systematic random sampling technique was adopted to select respondents from the selected departments, who fielded the questionnaire, which was the only instrument for data collection. Descriptive statistics and Chi-square tests were engaged for data analysis. Findings revealed a significant relationship between maladaptive daydreaming and students’ academic activities as well as their mental health. Therefore, MD affects both students’ mental health and their academic activities. The study recommends, inter-alia, increased awareness, early intervention, and regular counseling services to help students manage the condition effectively.