Previous research on associations between screen time and psychological well-being among children and adolescents has been conflicting, leading some researchers to question the limits on screen time suggested by physician organizations. We examined a large (n = 40,337) national random sample of 2- to 17-year-old children and adolescents in the U.S. in 2016 that included comprehensive measures of screen time (including cell phones, computers, electronic devices, electronic games, and TV) and an array of psychological well-being measures. After 1 h/day of use, more hours of daily screen time were associated with lower psychological well-being, including less curiosity, lower self-control, more distractibility, more difficulty making friends, less emotional stability, being more difficult to care for, and inability to finish tasks. Among 14- to 17-year-olds, high users of screens (7+ h/day vs. low users of 1 h/day) were more than twice as likely to ever have been diagnosed with depression (RR 2.39, 95% CI 1.54, 3.70), ever diagnosed with anxiety (RR 2.26, CI 1.59, 3.22), treated by a mental health professional (RR 2.22, CI 1.62, 3.03) or have taken medication for a psychological or behavioral issue (RR 2.99, CI 1.94, 4.62) in the last 12 months. Moderate use of screens (4 h/day) was also associated with lower psychological well-being. Non-users and low users of screens generally did not differ in well-being. Associations between screen time and lower psychological well-being were larger among adolescents than younger children.