Background: A negative lifestyle is reported to be related to poor mental health and quality of life (QOL). However, there is little information on this in university students. The objective of the present study was to investigate the association between mental health (i.e., anxiety, depression symptoms and stress), QOL, SWLS and lifestyle parameters (i.e., PA, sleep duration, ST and food habits) among Chilean university students and then to determine the differences in mental health, QOL, SWLS and lifestyle parameters according to gender. Methods: This cross-sectional study included a total of 211 university students (128 females and 83 males) aged 18–28 years. Mental health, QOL and lifestyle were measured through validated questionnaires. Results: Bad food habits (lowest score in the food survey) were linked to anxiety (2.3 [0.22–4.36], p = 0.03), depressive symptoms (3.75 [1.54–5.9], p = 0.001) and stress (2.24 [0.31–4.17], p = 0.023). Furthermore, <6 h of sleep was related to poorer mental health (13.5 [7.6–19.5], p = 0.001), anxiety (4.2 [2.0–6.4], p < 0.001), depressive symptoms (5.5 [3.2–7.9], p < 0.001) and stress (3.8 [1.8–5.9], p < 0.001). In addition, ≥4 h of ST was linked positively to negative mental health (8.3 [2.86–13.7], p = 0.003), depressive symptoms (3.45 [1.47–5.4], p = 0.001) and anxiety (3.2 [1.05–5.4], p = 0.004). Non-physical activity was related to the scores for anxiety (2.6 [0.20–5.0], p = 0.030), depression (2.7 [0.009–5.3], p = 0.049) and stress (2.4 [0.12–4.7], p = 0.039). Conclusions: this study showed that unhealthy lifestyle factors (i.e., insufficient sleep, lack of PA and prolonged ST) were strongly associated with poorer mental health and QOL in university students. These findings highlight the importance of addressing these aspects of lifestyle in intervention and health promotion programs aimed at young university students in order to improve their mental health and overall QOL.