This study examines the mediating role of emotional regulation on the association between family functioning and social interaction anxiety in young adults. Social interaction anxiety, being one of the forms of social anxiety, is on the rise in young adults and is associated with impairment in academic, occupational, and interpersonal functioning. Family functioning defined by communication, emotional support, adaptability, and cohesion is a strong predictor of emotional development and regulation. Emotional regulation, meanwhile, influences one's ability to cope with socially evaluative situations. The study employed a correlational research design and administered questionnaires to 274 respondents aged 18 to 25 years using standardized measures: the McMaster Family Assessment Device (FAD), Social Interaction Anxiety Scale (SIAS), and the Difficulties in Emotion Regulation Scale – 18 (DERS-18). Pearson correlation analysis revealed significant associations among the three variables. Mediation analysis revealed that emotional regulation significantly mediated the association between family functioning and social interaction anxiety. The indirect effect explained 43.2% of the total effect, therefore, indicating partial mediation. The results highlight the critical role of emotional regulation as a strong mechanism linking family dynamics and social anxiety, reflecting that interventions to increase improvement in emotional regulation and family support systems can significantly decrease social interaction anxiety in young adults.