Universities have recently been pressurized to go beyond their economic conceptualization of third-mission activities and contribute to solving grand societal challenges in the regions in which they are located. Social entrepreneurship has emerged as one mechanism by which universities can address societal challenges. Despite a growing awareness of universities’ potential and expectations to enhance social entrepreneurship in their geographical vicinities, how these processes become legitimized within a higher education context has received surprisingly little attention. This paper, therefore, explores factors affecting the (de)legitimacy process of social entrepreneurship within universities. Using a single case study design that relies on semi-structured interviews carried out in a Dutch public university, it was found that organizational legitimacy of social entrepreneurship remains unestablished. Furthermore, the legitimacy process is affected by (1) the expectations of stakeholders, the difficulty of measuring social impact and third-mission indicators; (2) an overemphasis on high-tech research and application as an organizational identity; (3) the absence of a leader in the field and lack of organizational recognition; and (4) stringent regulations of public institutions in the Netherlands. In addition, enhancing social entrepreneurs is hindered by the lack of place-based belonging among the student body. Consequently, this paper argues that a holistic approach that focuses on the specificities of universities and the increasing competitive environment in which they have come to function, the potential facilitating role of other organizational actors in the field, and designing appropriate policy instruments and incentives would benefit universities in their efforts to enhance social entrepreneurship.