Background: Along with its high infectivity and fatality rates, the 2019 Corona Virus Disease (COVID-19) has caused universal psychosocial impact by causing mass hysteria, economic burden and financial losses. Mass fear of COVID-19, termed as "coronaphobia", has generated a plethora of psychiatric manifestations across the different strata of the society. So, this review has been undertaken to define psychosocial impact of COVID-19. Methods: Pubmed and GoogleScholar are searched with the following key terms-"COVID-19", "SARS-CoV2", "Pandemic", "Psychology", "Psychosocial", "Psychitry", "marginalized", "telemedicine", "mental health", "quarantine", "infodemic", "social media" and" "internet". Few news paper reports related to COVID-19 and psychosocial impacts have also been added as per context. Results: Disease itself multiplied by forced quarantine to combat COVID-19 applied by nationwide lockdowns can produce acute panic, anxiety, obsessive behaviors, hoarding, paranoia, and depression, and post-traumatic stress disorder (PTSD) in the long run. These have been fueled by an "infodemic" spread via different platforms of social media. Outbursts of racism, stigmatization, and xenophobia against particular communities are also being widely reported. Nevertheless, frontline healthcare workers are at higher-risk of contracting the disease as well as experiencing adverse psychological outcomes in form of burnout, anxiety, fear of transmitting infection, feeling of incompatibility, depression, increased substance-dependence, and PTSD. Community-based mitigation programs to combat COVID-19 will disrupt children's usual lifestyle and may cause florid mental distress. The psychosocial aspects of older people, their caregivers, psychiatric patients and marginalized communities are affected by this pandemic in different ways and need special attention. Conclusion: For better dealing with these psychosocial issues of different strata of the society, psychosocial crisis prevention and intervention models should be urgently developed by the government, health care personnel and other stakeholders. Apt application of internet services, technology and social media to curb both pandemic and infodemic needs to be instigated. Psychosocial preparedness by setting up mental organizations specific for future pandemics is certainly necessary.