Lower psychological wellbeing is associated with poor outcomes in a variety of diseases and healthy populations. However, no study has investigated whether psychological wellbeing is associated with the outcomes of COVID-19. This study aimed to determine whether individuals with lower psychological wellbeing are more at risk for poor outcomes of COVID-19. Data were from the Survey of Health, Aging, and Retirement in Europe (SHARE) in 2017 and SHARE's two COVID-19 surveys in June-September 2020 and June-August 2021. Psychological wellbeing was measured using the CASP-12 scale in 2017. The associations of the CASP-12 score with COVID-19 hospitalization and mortality were assessed using logistic models adjusted for age, sex, body mass index, smoking, physical activity, household income, education level, and chronic conditions. Sensitivity analyses were performed by imputing missing data or excluding cases whose diagnosis of COVID-19 was solely based on symptoms. A confirmatory analysis was conducted using data from the English Longitudinal Study of Aging (ELSA). Data analysis took place in October 2022. In total, 3,886 individuals of 50 years of age or older with COVID-19 were included from 25 European countries and Israel, with 580 hospitalized (14.9%) and 100 deaths (2.6%). Compared with individuals in tertile 3 (highest) of the CASP-12 score, the adjusted odds ratios (ORs) of COVID-19 hospitalization were 1.81 (95% CI, 1.41-2.31) for those in tertile 1 (lowest) and 1.37 (95% CI, 1.07-1.75) for those in tertile 2. As for COVID-19 mortality, the adjusted ORs were 2.05 (95% CI, 1.12-3.77) for tertile 1 and 1.78 (95% CI, 0.98-3.23) for tertile 2, compared with tertile 3. The results were relatively robust to missing data or the exclusion of cases solely based on symptoms. This inverse association of the CASP-12 score with COVID-19 hospitalization risk was also observed in ELSA. This study shows that lower psychological wellbeing is independently associated with increased risks of COVID-19 hospitalization and mortality in European adults aged 50 years or older. Further study is needed to validate these associations in recent and future waves of the COVID-19 pandemic and other populations.