This study aimed to examine the role and impact of social media on the knowledge of the COVID-19 pandemic in Bangladesh through disseminating actual changes in health safety, trust and belief of social media’s coverage statistics, isolation, and psychological numbness among students. This study used a cross-sectional design in which a quantitative approach was adopted. Data from an online survey were collected in a short period of time during the early stages of COVID-19 to determine the relationship between social media activity and knowledge of the COVID-19 pandemic with accuracy. A total of 189 respondents were interviewed using structured questionnaires during the onset of the COVID-19 outbreak in Bangladeshi university students. Exploratory factor analysis (EFA) and path analysis were performed. Out of 189 respondents, about 80% were aged between 16 and 25 years, of which nearly 60.33% were students. This study explored four factors—knowledge and health safety, trust in social media news, social distancing or quarantine, and psychological effect—using factor analysis. These four factors are also found to be positively associated in path analysis. Validation of the model was assessed, revealing that the path diagram with four latent exogenous variables fit well. Each factor coefficient was treated as a factor loading (β = 0.564 to 0.973). The results suggested that the measurement models using four elements were appropriate. The coefficient of determination was 0.98, indicating that the model provided an adequate explanation. Social media is transforming the dynamics of health issues, providing information and warnings about the adverse effects of COVID-19, having a positive impact on lockdown or quarantine, and promoting psychological wellness. This comprehensive study suggested that social media plays a positive role in enhancing knowledge about COVID-19 and other pandemic circumstances.