This article analyzes the effectiveness of youth policy implemented in the Republic of Uzbekistan during 2017–2026 within the context of mahalla (community-level self-governance) development. The research objective is to evaluate the role of the mahalla system in identifying and resolving youth-related issues, and to develop evidence-based recommendations for centering the youth factor within the framework of the 2026 “Year of Mahalla Development and Society Advancement.” The study employs a descriptive-analytical approach based on official statistical data, regulatory and legal documents, and government program analyses. The findings demonstrate that over the past eight years, youth entrepreneurship has tripled, higher education enrollment has increased from 9% to 42%, and the number of unemployed youth has been halved. However, at the mahalla level, critical issues including youth mental health, digital literacy, and career guidance continue to require systematic, institution-level solutions.