This research investigated the impact of Covid-19 literacy on fear, protective behaviors, and conspiracy beliefs of students in Pakistan using a cross-sectional survey research design along with an online questionnaire. The data were collected from students of three universities in the province of Punjab with permission from concerned authorities. A total of 301 responses were received that were analyzed by applying descriptive and inferential statistics in SPSS. The results indicated that socio-demographic variables of students such as age, gender, university, study program did not predict their Covid-19 literacy, fear of Covid-19, conspiracy beliefs. However, the student’s gender appeared to predict their health-protective behaviors as female students were more likely to adopt protective behaviors than male students. Besides, Covid-19 literacy of university students had a statistically significant but negative association with their fear of Covid-19 and a positive association with their health-protective behaviors and conspiracy beliefs. These results demonstrated the potential benefits of Covid-19 literacy to respond proactively to the fear caused by the Covid-19 pandemic and adoption of health-protective behaviors. Health literacy related to Covid-19 should be considered as a crucial tool for the prevention and spread of Covid-19 infection as individual preparedness besides system preparedness is essential to cope with pandemic and infodemic situations proactively. This research would make a great contribution to the existing research on health literacy related to the Covid-19 pandemic as limited studies have been published so far.