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The pandemic has disrupted youths' lives and harmed their psychological well-being. Using Positive Youth Development (PYD) theory, we studied 726 university students in Hong Kong. Structural equation modeling showed that digital citizenship, online engagement, media and information literacy (MIL), and social trust were positively linked to psychological well-being (PWB), while time spent on Information and Communication Technologies was negatively linked. Higher digital citizenship understanding led to greater MIL, which increased social trust. Social trust had the strongest positive link to PWB, indicating that higher community trust enhances psychological health. This study emphasizes the need for MIL and digital citizenship education for all youths, promoting informed digital citizens who contribute positively to their well-being and communities.