Today the world is witnessing a lot of problems among youth, it has a significant influence on their mental health. Self-efficacy refers to “trusting one’s abilities and powers for learning and performance” (Hill, 2002). It involves the feeling of self-worth affecting appraisal of competence and emotional well-being which would aid in the development of mental health. This study is conducted to investigate the relationship between self-efficacy and psychological well-being among youth in Kerala. A sample of 298 youths from Kozhikode, Kerala was selected through simple random sampling and data was collected with the help of Self-Efficacy Scale by Schwarzer & Jerusalem (1995) and Psychological wellbeing Scale by Sreejith Sudhakar and Kadhiravan (2018). The results revealed a significant difference in self-efficacy among youth based on their gender. There was a significant positive correlation between self-efficacy and psychological well-being among youth. The implications are discussed in this article.