Background Experiencing poor mental health during adolescence predisposes an individual to psychiatric morbid conditions in adulthood. We estimated the prevalence of psychological morbidity and its associated factors, among school-going adolescents in higher secondary schools of urban Puducherry. Methods We did this cross-sectional study among adolescents studying in classes 11 and 12 from selected schools of urban Puducherry, including one government and three private schools. Study tools used were the General Health Questionnaire-12 and Perceived Stress Scale-10 to assess psychological morbidity and perceived psychological stress in adolescents, respectively. Risk factors in academic, environmental, personal and health-related domains were captured using a structured questionnaire. Study questionnaires were self-administered by the participants in classrooms. Bivariate and multivariate analyses were done to identify risk factors for psychological morbidity. Results Of the 820 adolescents surveyed, the prevalence of psychological morbidity was 25.4% (95% CI 22.4- 28.5). Academic factors such as reporting peer pressure for academic performance and lack of extracurricular activities at school were associated with psychological morbidity. Among health-related factors, adolescents who reported having difficulty in coping with pubertal changes, being worried about their physical appearance, reporting substance abuse and experiencing sleep disturbances had greater chances of having screened with psychological morbidity. Of note, adolescents with psychological stress had 2.5 times higher chances of having psychological morbidity. Conclusions We estimated that 1 in 4 school-going adolescents in urban Puducherry suffered psychological morbidity. Reducing the academic burden and advocating health promotion through a life skills approach may improve mental wellness in Indian adolescents.