Since the outbreak of COVID-19, restrictions to minimize its spread have had a profound effect. Government instigated restrictions, such as social isolation, have affected millions worldwide, and the downstream consequences of perceived loneliness upon mental health and sleep are largely unknown. A total of 1662 individuals participated in an online survey. Loneliness, anxiety, and sleep quality were assessed using the UCLA Loneliness Scale, the Generalized Anxiety Disorders scale, and the Pittsburgh Sleep Quality Index, respectively. Higher levels of perceived loneliness, as well as each one-unit increase in anxiety, were independent predictors of poor sleep quality, where OR = 1.16 (95% CI: 1.03–1.31) and 1.16 (1.11–1.21), respectively, and after adjustment. In our path analysis, we revealed significant direct effects between loneliness and sleep quality (β = 0.25, p < .001), as well as generalized anxiety and sleep quality (β = 0.28, p < .001), and generalized anxiety mediated the relationship between loneliness and sleep quality (β = 0.33, p < .001). Heightened anxiety and perceived loneliness appear to be significant drivers of poor sleep quality during the COVID-19 pandemic. Digital media platforms that encourage support groups for those experiencing social isolation are encouraged, along with self-help and meditative practices, which may minimize an increase of mental health and sleep disorder diagnoses post COVID-19.