Background: University students’ emotions, creativity, and psychological well-being are interrelated, yet the mechanisms linking emotion-driven activities to creative expression and mental health outcomes remain underexplored. Purpose: This study aimed to examine the interrelationships between students’ emotions in emotion-based activities, creativity, and psychological well-being. Research Design: A quantitative, cross-sectional design was employed, utilizing validated self-report questionnaires and Structural Equation Modeling (SEM) for data analysis. Study Sample: The sample consisted of 952 university students learning English as a foreign language (EFL). Data Collection and/or Analysis: Data were collected via standardized questionnaires assessing emotional engagement, creativity, and psychological well-being. SEM was conducted using AMOS to evaluate the measurement and structural models, with reliability and validity indices reported. Results: Emotional engagement negatively predicted creativity (β = −0.584, p = .002), indicating that heightened involvement in emotion-based activities may constrain creative expression. Creativity positively predicted psychological well-being (β = 0.591, p = .001), and emotions exhibited a strong positive effect on well-being (β = 0.653, p = .001). The structural model explained 51% of the variance in psychological well-being (R² = .513, p < .001). The measurement model demonstrated satisfactory fit (CFI = 0.924, RMSEA = 0.067, TLI = 0.947), with all constructs showing strong reliability (CR ≥ 0.83) and validity (AVE ≥ 0.86). Conclusions: The findings underscore the complex interplay between affective experiences and creativity in shaping students’ psychological well-being. Educational interventions should consider balancing emotional engagement with opportunities for creative expression to enhance mental health outcomes in academic contexts.