Purpose: The purpose of this paper is to investigate the role of a second-order state-like construct "psychological capital" (or PsyCap) as an underlying mechanism explaining the personality-academic achievement (AA) relationship in the educational context. Design/methodology/approach: The conceptual model was statistically tested on a sample of 305 post-graduate students at a premier business school in central India using standard measures of personality and PsyCap. AA was measured through cumulative grade point average obtained from the administrative office. Data were collected through multiple sources to minimize common method variance. Analysis was done using macro PROCESS and validated using PLS-SEM. Findings: Results indicated that PsyCap positively influenced AA. Furthermore, PsyCap mediated the relationship between openness to experience, extraversion, agreeableness dimensions of student personality and AA. Research limitations/implications: Longitudinal research designs with interventions to enhance PsyCap of students may strengthen the findings of this study. Practical implications: The findings suggest that the curriculum in higher education institutions should include interventions on building the PsyCap of the students as it positively correlates to the AA. Academic administrators may not have control on students' dispositional traits, but they can design interventions to improve the psychological (state like) resources of the students. Follow-up interviews with academic administrators reinforced these implications. Originality/value: This study provided initial evidence that positivity, in general, and PsyCap, in particular, have a positive impact on students' AA. This is one of the first studies to examine the role of PsyCap in personality-AA relation in the higher educational context wherein high levels of stress and burnouts have been reported by students due to high competition in achieving goals.