The implementation of the New Education Policy (NEP) 2020 in India heralds a significant transformation in the higher education landscape, aiming to foster a holistic and multidisciplinary approach to learning. This comparative study explores the impact of NEP 2020 on eight psychological dimensions among students, including anxiety, stress, depression, regression, fatigue, guilt, extraversion, and arousal. Drawing on a sample of 140 undergraduate students from Dev Sanskriti Vishwavidyalaya, divided into NEP and Non-NEP cohorts, the study employs Quota sampling to ensure a representative sample. The Eight State Questionnaire (ESQ) is utilized to measure the psychological dimensions, with data collected through an online survey platform. Statistical analysis, including independent samples t-tests, reveals no statistically significant differences in most psychological dimensions between NEP and Non-NEP students. However, a notable difference is observed in extraversion levels, indicating a potential influence of the policy on this personality trait. The study addresses ethical considerations and acknowledges limitations, such as the study's causal-comparative design and potential response biases. The findings suggest that while NEP 2020 may not directly impact student psychological well-being in most dimensions, it may have broader effects on personality traits. These insights have implications for educational policymakers and practitioners, highlighting the need for further research to understand the nuanced effects of educational policies on student behavior and well-being. Overall, this study contributes to the ongoing discourse surrounding educational reform in India and underscores the importance of creating supportive and inclusive learning environments.