The rapid development of Artificial Intelligence (AI) in higher education is not always accompanied by an improvement in students’ critical thinking skills and may even lead to cognitive dependency if not supported by adequate literacy. This study aims to analyze the role of Artificial Intelligence (AI) literacy in mediating the effect of AI competence on students’ critical thinking skills in East Nusa Tenggara. This research employs a quantitative approach with an explanatory design. The sample consists of 200 students selected using incidental sampling. Data were collected through a Likert-scale questionnaire and analyzed using Structural Equation Modeling based on Partial Least Square (SEM-PLS). The results indicate that AI competence has a positive and significant effect on both critical thinking skills and AI literacy. AI literacy also has a positive and significant effect on critical thinking skills. Furthermore, AI literacy significantly mediates the relationship between AI competence and critical thinking skills, indicating partial mediation in the research model. These findings suggest that mastery of AI does not automatically enhance critical thinking skills without adequate AI literacy. Therefore, the implications of this study highlight the importance of integrating AI competence and literacy into higher education curricula through learning approaches that emphasize analytical, reflective, and ethical dimensions to optimize the development of students’ critical thinking skills in the era of digital transformation.
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