This study investigates the use of social media by university students and its impact on social capital. Data was collected from the university students of Islamabad. The is on exploring the impact of the use of social media on social capital. The researcher hypothesizes that greater the use of social media, lesser the face-to-face interaction with family of the university students. The study applies Time Displacement Theory and survey method is used to investigate. The researcher selected three universities in Islamabad where data was collected from 150 students using random sampling method including both male and female students. The purpose of the study is to find whether and to what extent university students use social media specifically Facebook and how far their engagement on social media effects their real-time contact with their family, friends, and relatives - to what extent the users inhibit from taking part in community activities. It is expected that heavy Internet users will have greater social withdrawal from community practices and less real-time interaction with their parents, siblings, and relatives. However, users will make more friends virtually.