Introduction: The basis of Social Norms Theory is that behavior is influenced by the perception of peer behavior. This implies that an overestimation (misperception) of substance use by peers would lead to an increase in personal substance use. It is hypothesized that the misperception of substance use by peers is negatively associated with health and academic performance, and that this association can be explained by an increase in personal substance use. The aim of this study is to investigate the associations of misperception of consumption of tobacco, alcohol, and recreational drugs with health and academic performance, and to test whether or not this association could be explained by substance use in a sample of university students. Methods: Data of 6403 university students in five European countries were gathered through a questionnaire about substance use by themselves and by peers, physical and mental health, and academic functioning. Misperception is defined as an overestimation of the estimated prevalence of substance use among students. Multivariate models are built with misperception regarding tobacco, alcohol and recreational drugs, and personal use of substances as independent variables, and health and academic performance as dependent variables. Results: Misperception is significantly associated with health and academic functioning. This association could not be explained by personal substance use. Conclusions: This study subscribes to an earlier work on the importance of social norms, which indicates a negative influence of misperceptions on health and academic outcomes.