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Background: Adolescence is a developmental phase between childhood and adulthood, a period where one gains a desire of intimacy and increased responsibilities. Based on their interaction with family and society, adolescents develop positive outcomes such as getting involved in healthy behaviour and negative outcomes such as depression and substance abuse. The objectives of the study were to determine the prevalence of poor psychological well-being and substance abuse among adolescents (13 to 19 years) in Central Kerala, and to assess the role of substance abuse in psychological well-being in adolescents.Methods: A cross sectional study was conducted among 300 secondary and higher secondary school students in three government aided institutions in Central Kerala. All students available in the school at the time of the study formed the inclusion criteria; however, 10th standard students were excluded. Data on basic demographic variables were collected. General Health Questionnaire and Adolescent Alcohol Drug Involvement Scale (AADIS) were used to collect information on psychological wellbeing and alcohol use. The data were entered and analysed using standard statistical package. For significance testing, Chi square test was carried out.Results: Mean age was 14.49 years with a standard deviation of 1.31. Males were 64.5% and 82.6% belonged to nuclear family. Psychological wellbeing was significantly better in males compared to females (p=0.025). Males (7.6%) and females (4.3%) were found to be using alcohol by AADIS questionnaire. Those who were not under the influence of alcohol had better well-being when compared to those who consumed alcohol (p=0.0016).Conclusions: Prevalence of poor psychological wellbeing and substance abuse among adolescents was 7.8% and 6.4% respectively. Females were more emotionally unstable than males. Substance abuse cause further deterioration of mental function in adolescents.