As a global phenomenon, mobile phone addiction has become an increasingly common issue among Chinese university students. Although previous research explored the link between mobile phone addiction and mental health, the possible mechanism underlying the above association is unclear. We administered a cross-sectional survey to 585 participants from two universities in Kunming, southwest China, from October 2021 to January 2022. Our results suggested that mobile phone addiction was negatively associated with mental health, and sleep quality partially mediated the relationship between mobile phone addiction and mental health. Furthermore, perceived social support positively moderated the direct effect of sleep quality on mental health, as well as the indirect effect of mobile phone addiction on mental health. These findings provide a new insight into the underlying mechanism by which mobile phone addiction affects university students' mental health. The results emphasize a necessary task for administrators, health workers, and family members to attach importance to the overuse of mobile phones among university students.