Many young people who experience social marginalization (such as young people of color, who identify as LGBTQ, and who have experienced housing instability, among others) have often faced significant trauma exposure and social oppression and may endure subsequent adverse impacts on their well‐being. Conversely, many such young people exhibit adaptive responding—the ability to maintain well‐being through and despite such contextual constraints. This theoretical paper illustrates a conceptual model for how third places—public settings which offer sociability and community connection—may foster adaptive responding through the mutually constitutive (i.e., mutually reinforcing and interrelated) mechanisms of psychological sense of community and social capital. As prior work on third places has not considered the social marginalization which many young people face, especially in public settings, this theoretical model also considers how social policing in third places potentially moderates the mutually constitutive relationships between participation in third places, social capital, and psychological sense of community. This paper ends with a proposed research agenda, which may empirically test this theoretical model and its assumptions through future model development. Lastly, key considerations for policy and practice are offered, with particular attention to how young people may be affirmed and welcomed in third places rather than socially policed.