Generation Z, as digital natives, has grown up immersed in technology and artificial intelligence (AI), which increasingly influence their decision-making across personal, educational, and professional domains. This study examines how AI shapes Gen Z’s cognitive processes, behavioral patterns, and interactions with digital systems, focusing on areas such as consumer behavior, academic engagement, career choices, and workplace decision-making. Drawing on recent literature, the study highlights AI’s role as a decision-support system, the algorithmic influence on choices, trust in human–AI interaction, psychological effects, and ethical considerations. Findings indicate that AI enhances efficiency, personalization, and problem-solving but also presents risks related to overreliance, privacy, and autonomy. The study underscores the need for frameworks that balance AI assistance with critical thinking and ethical awareness, offering insights for educators, marketers, policymakers, and organizations seeking to engage and empower Generation Z.