The prevalence of pathological gambling among college students is increasing. Few studies have directly examined the relation between reward processing and gambling severity while concurrently examining the effects of co-occurring negative affect in this at risk population. This study used Structural Equation Modeling (SEM) techniques to analyze results from an online survey of 352 female and 96 male students age 18–25. Participants completed measures of past year gambling behavior and severity of gambling problems using the Canadian Problem Gambling Index and the Problem Gambling Severity Index. Negative affect and reward processing were measured by the 21-item version of the Depression, Anxiety, and Stress Scales and the Behavioral Inhibition System and Behavioral Activation System (BIS/BAS) scales, respectively. Thirty-five percent of participants reported gambling in the previous 12 months, and 11% had gambling severity scores indicative of “moderate-risk” or “problem gambling.” Gambling severity was associated with negative affect. Negative affect, in turn, was correlated with the unitary BIS scale and inversely associated with the BAS reward responsiveness scale. Reward responsiveness was also inversely associated with gambling severity. In the SEM models, the association between reward responsiveness and gambling severity was mediated by negative affect among males but not among females. Potential explanations for these findings and their implications for addressing problem gambling are discussed.