The rates of depression among young adults have been increasing in high-income countries and have emerged as a social problem in South Koreans aged 19–34. However, the literature is unclear on whether the neighborhood environment that young adults live in affects the onset and severity of their depressive symptoms. This study analyzed data from the 2019 Korean Community Health Survey (KCHS) using the Tobit model to identify the effect of the neighborhood environment on young adults’ depressive moods. Controlling for other corresponding factors, young adults’ neighborhood environment satisfaction affected their depression, and natural environment satisfaction (32.5%), safety level satisfaction (31.0%), social overhead capital (SOC), environment satisfaction (30.2%), trust between neighbors satisfaction (20.1%), and public transportation environmental satisfaction (12.2%) affected young adults’ depressive moods. Of these, natural environment satisfaction (32.5%), safety level environment satisfaction (31.0%), and SOC environment satisfaction (30.2%) affected young adults’ depressive mood to a similar extent. This implies that many young adults in South Korea live in inadequate neighborhood conditions. This research contributes to the literature by identifying the specific environmental factors that affect young adults’ depressive moods.