Groundwater arsenic is a notorious toxicant and exposure to environmentally relevant concentrations persists as a healthcare burden across the world. Arsenic has been reported to jeopardize the normal functioning of the immune system, but there are still gaps in the understanding of thymic T cell biology. Immunotoxic influence of arsenic in thymic integrity demands a potent restorative molecule. The objectives of this study were to examine key signaling cross‐talks associated with arsenic‐induced immune alterations in the thymus and propose melatonin as a potential candidate against immunological complications arising from arsenic exposure. Swiss albino mice were exposed to sodium arsenite (0.05 mg/L; in drinking water) and melatonin (IP:10 mg/kg BW) for 28 days. Melatonin successfully protected thymus from arsenic‐mediated tissue degeneration and maintained immune homeostasis including T cell maturation and proliferation by mitigating oxidative stress through Nrf2 upregulation. Additionally, melatonin exerted ameliorative effect against arsenic‐induced apoptosis and inflammation by inhibiting p53‐mediated mitochondrial cell death pathway and NF‐κB‐p65/STAT3‐mediated proinflammatory pathway, respectively. For the first time, we showed that arsenic‐induced profibrotic changes were inhibited by melatonin through targeting of inflammation‐associated EMT. Our findings clearly demonstrate that melatonin can be a viable and promising candidate in combating arsenic‐induced immune toxicity with no collateral damage, making it an important research target.