The move toward a paperless environment has become the driving force behind sustainable development and e-government usage in many public sector institutions. It is equally at the heart of the government campaign to make service delivery in public institutions cost effective, seamless, and efficient. The universities are supposed to be at the front-line of this campaign due to their operations which involves the heavy usage of papers at huge costs. Thus, making it important for university management to provide ICT support in order to promote paperless exchange of information and presentations. It is however, understood recently, that there are issues which surround the low usage of ICT among university managements and ultimately, paperless environment. The purpose of this paper is to discuss the main issues and challenges that hinder the implementation of paperless environment in Nigerian universities. The paper highlights the cyclical order of document generation, document management and document sharing as the process in which a paperless environment can take place within both the academic and the administrative settings in the university. The paper highlights and discussed the challenges hindering the attainment of paperless environment among which are infrastructural gap, inadequate ICT support and attitudinal challenge. It is recommended that for smooth operation of paperless environment, government must show strong political will, bridge the infrastructure gap especially electricity as well as train staff on the path to ICT usage.