BACKGROUND: In Europe, the highest proportion of HIV diagnoses are in gay men and other men who have sex with men (MSM). Globally, HIV prevalence is particularly high among males who report selling sex, but rates among men who buy sex from other men are less clear. This study analyzed the association of transactional sex (TS) and HIV diagnosis, sexually transmitted infection (STI) diagnoses, and various drug use; and examined the variations in TS by payment direction. METHODS: We conducted a cross-sectional, non-randomized, observational study. This European MSM Internet Survey recruited MSM from 38 European countries. For descriptive purposes we stratified according to TS behavior (frequently selling sex, frequently buying sex, neither frequently selling nor buying sex in the previous 12 months), and we constructed separate multivariable logistic regression models to investigate whether engaging in TS accounted for some of the HIV- and STI diagnoses and drug use in this population. RESULTS: Of almost 161,000 sexually active MSM, 12.2% engaged in TS. The multivariable logistic regression results showed that relative to not frequently engaging in TS, frequently selling sex was independently associated with a higher odds of reporting diagnosed HIV (ever, adjusted odds ratio [aOR] 1.60, confidence interval [CI] 95% 1.39 to 1.85), bacterial STIs (past 12 months, aOR 1.75 CI 95% 1.54 to 2.00), using heroin or crack cocaine or injecting drugs (aOR 3.17, CI 95% 2.70 to 3.73), and using benzodiazepines (aOR 2.13, CI 95% 1.88 to 2.41). Compared to men not engaging in frequent TS, frequently buying sex was associated with a higher odds of using benzodiazepines (aOR 2.13, CI 95% 1.88 to 2.41). CONCLUSIONS: MSM who frequently sell sex suffer greater sexual- and substance use risks than other MSM, but both men who frequently sell and those who buy sex are more likely to use benzodiazepines. MSM who sell sex to other men constitute an important at-risk population who must be offered targeted health services.