Health literacy is the capacity to understand, access, and effectively utilize health information and healthcare to make informed health decisions. This cross-sectional study uses the multi-dimensional Health Literacy Questionnaire (HLQ) to investigate associations between demographic characteristics, self-rated health and health literacy among students (n = 932) in two Australian universities. We used Pearson's chi-square to determine differences in self-rated health between demographic groups, Cohen's defect Sizeto measure differences in HLQ scale scores between demographic groups, and logistic regression to determine associations between HLQ scores and self-rated health. A clear association was found between self-rated health and health literacy: as health literacy increased, so did self-rated health. Findings also demonstrate lower health literacy for culturally and linguistically diverse students, and those studying Arts compared to Health degrees. Lower self-rated health was correlated with HLQ scales including being less active in managing one's own health, having less social support for one's health, possessing insufficient health information and lower confidence in navigating the healthcare system. This study provides a comprehensive picture of potentially vulnerable students and identifies strategies for supporting their health endeavors while studying at university.