Digital developments have been influencing the readers’ behavior since early 1990s. The libraries have also been turning into hybrids and managing reading materials in both print and electronic forms. The present study aimed to explore reading behavior of generation “Y” students (i.e., born during the 1980s and early 1990s, also known as internet generation) in Pakistan to find out the emerging reading trends among them, and impact of digital media on their reading behavior. It also aimed to obtain suggestions on the role of libraries in facilitating Generation “Y” by responding to the ongoing changes. The quantitative research design, based on a self-administered survey was used. The population consisted of students from large and medium sized general universities of Lahore, as classified by Higher Education Commission (HEC) Pakistan. Stratified purposive sampling technique was carried out to select the sample. Total 515 final year students of masters’ class from three subject groups i.e. Pure Sciences, Social Sciences and Humanities responded to the survey from 07 universities of Lahore. The instrument was constructed on the basis of published literature, and was validated. The collected data was analyzed using SPSS (16.0). The results indicate that students still prefer reading in print format. They reported a significant change in their reading behavior during the past five years, and that their reading time on digital devices and overall reading has been increased, despite their preferring print format. It was found that they have access to electronic reading devices and use those frequently for digital reading; especially use of laptops is very common. Findings also revealed that electronic resources are frequently used for accessing digital reading material by the students. It was determined that Generation “Y” students want to see future libraries as libraries with open access to a wide range of reading material in both print and digital form. They want to have 24/7 access to electronic and physical resources. The findings of this study will be helpful in identifying the trends of reading behavior and for planning and designing library services according to future needs. Keywords: Generation “Y”, Reading behavior, Digital paradigm, Future libraries, Onscreen reading, Pakistan