Background: Many institutional factors predispose University students to mental health issues, including depression. However, with no central database for depression in Uganda, literature on depression and associated institutional factors among undergraduate students is scarce. This study examined the prevalence of and institutional factors associated with depression among undergraduate students at Gulu University. Methods: This was a cross-sectional survey among 452 undergraduate students at Gulu University in the academic year 2018/2019 in February and March 2019. A stratified simple random sampling was used to identify the participants. A self-administered questionnaire was used to collect data. Descriptive statistics, including mean and frequency, were used. We conducted a bivariate analysis to determine the association between variables employing Pearson’s chi-square test or Fischer’s exact test. We conducted a multivariate analysis with factors that had significant P-values of less than 0.05. Results: The average age of the respondents was 22.4 (SD - 2.4), more than half (53.1%) were male and 38.50% were in the second year. The results show that 31.19% reported depression. After controlling for age and sex, the results showed that there was a statistically significant correlation between depression and faculty (aOR - 1.15), year of study (aOR - 0.77), happiness with the course (aOR - 0-0.49), satisfaction with academic performance (aOR - 0.45), and satisfaction with academic quality (aOR - 0.61). The results indicated that the predictors of depression among undergraduate students were faculty, year of study, satisfaction with academic performance, and satisfaction with academic quality. Conclusion: A substantial proportion of Gulu University undergraduate students reported high levels of depression. The results, therefore, showed that depression in undergraduate students is an identifiable disorder that needs diagnosis, prevention, and treatment. Faculty, year of study, satisfaction with academic performance, satisfaction with academic quality were predictors of depression. Thus there is an urgent need for counseling, psychoeducation, and preventive mental health services as an essential part of the university setup.