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Covid-19 literacy, a social vaccine, is crucial to cope pandemic situations as it helps individuals to manage panic situations, adopt health preventive behaviours and adapting to the new normal. This research examined the effects of Covid-19 literacy on fear, protective behaviour, and conspiracy beliefs of university students using an online questionnaire. A cross-sectional survey was conducted at two universities from Lahore with permission from concerned authorities. A total of 301 received responses were analyzed by applying descriptive as well as inferential statistics in SPSS. The results indicated that Covid-19 literacy appeared to predict negatively fear of Covid-19 and conspiracy beliefs and positively health-protective behaviours. In other words, the university students with better Covid-19 literacy appeared to have less fear of Covid-19, more likely to adopt health-protective behaviours and believe less in conspirative information. These results demonstrated the potential benefits of Covid-19 literacy to respond proactively to the fear caused by the Covid-19 pandemic, managing infodemic and adoption of health-protective behaviours. These results would be useful for policymakers, NGOs, health professionals, and university librarians in planning health education and promotion for not only university students but also for general public. This research contributed to the existing research on health literacy related to the Covid-19 pandemic in general and Covid-19 literacy in particular as limited studies have been published so far. • Rapid spread of Covid-19 called for peoples' ability to use credible health information and adaption of existing life styles worldwide. • Covid-19 literacy is essential to respond pandemic and infodemic situations as it enables people to manage panic and adopt health preventive behaviours. • The need for health education among general public is realized more than ever to respond Covid-19 pandemic and infodemic. • Covid-19 literacy predicted negatively the Covid-19 fear and conspiracy beliefs and positively health protective behaviours. • The government and NGOs should strategically invest in health education to achieve sustainable public health in the new normal. [ABSTRACT FROM AUTHOR]