The complex and critical global issues of the 21st century resulting from the unsustainable growth of tourism and hospitality, like air, land, and water pollution, have exacerbated concerns over whether educational institutions equip future managers and employees with adequate skills to meet the new demands of the current era. These ever-growing global sustainability issues stemming from the sophisticated interactions between people and the planet have no simple answers. They require well-skilled critical thinkers disposed of analyticity and systematicity to consider them and make positive contributions through their sustainable decisions. Despite this recognition, there are limited studies of the tourism and hospitality industry focusing on this crucial topic, and it is unclear how sustainability knowledge may result in more sustainable decision-making abilities. Accordingly, the current study proposed a model that links tourism and hospitality students’ sustainability knowledge to their sustainable tourism decision-making, testing the mediating role of critical thinking. Applying a quantitative research design, the researchers used a self-administered online survey to collect data from 146 full-time tourism students in Northern Cyprus. The PROCESS plug-in for the statistical package for social sciences was used to test the hypotheses of this study. The result of this study revealed that sustainability knowledge and critical thinking play significant roles in students’ sense of sustainable tourism competency and their sustainable tourism decision-making power. This study discusses how critical thinking serves as a mediating factor between knowledge of environmental sustainability, perceived competency in sustainable tourism, and sustainable decision-making ability. This study offers a more nuanced view of critical thinking’s function in terms of converting knowledge into sustainable tourism practices.