There are two causes of packet losses during a wireless transmission: losses caused by collisions and losses caused by poor channel conditions. The throughput and spatial reuse of IEEE 802.11 based wireless networks, as well as the effectiveness of the rate adaptation algorithms they use, is adversely affected by their inability to determine the real cause of a packet loss. To address this issue, this paper proposes a mechanism based on Error Vector Magnitude (EVM) to discern random channel errors from collisions in wireless networks. The proposed mechanism is based on first developing an analytic model to characterize the EVM of a packet in the presence and absence of a collision. A threshold based classifier is then proposed that selects the threshold value such that the crossover error rate is achieved. Simulation results are presented to demonstrate the accuracy of the proposed collision detection mechanism.