Background The COVID-19 pandemic has caused a devastating disruption in medical education worldwide. The influence on training, mainly for undergraduate MBBS pupils, has been noteworthy, especially the significant and unexpected shift to online learning. Materials and methods We performed a two-month, cross-sectional study from June to August 2022 at Kasturba Medical College in Mangalore, India. The study participants were second- and third-year MBBS students at Kasturba Medical College. The sample size was 319. We collected data using a pre-structured, validated, printed questionnaire, then coded and entered the data into SPSS Statistics for Windows, version 25.0, for interpretation. Results A total of 319 people took part in the study. Of these, 60.2% were females, 39.4% were males, 71.8% were from the batch of 2019-2020, and the remaining 28.2% were from the batch of 2018-2019. Among the participants, 90 students suffered from COVID-19, including 72.7% (n = 65) from the second year. Twenty-four percent of the population did not contract COVID-19, including 88 from the second year. A total of 153 participants were unsure whether they were infected with COVID-19, including 57.5% from the second year and 42.5% from the third year. The study group's p-value of <0.0001 is statistically significant. On multivariate analysis, 54.5% of the study participants said the pandemic caused a significant disruption to their medical education. A majority of students (51.7%) agreed that the pandemic hampered practical/clinical work; 42.9% of participants somewhat disagreed that the pandemic hampered their interest in pursuing medical education in the future; and 21.9% of students said the pandemic hindered their interest in further studying medicine. Regardless of gender, a majority of the participants (78.1%) felt that online education negatively affected their time management skills and ability to cover the syllabus. Nearly half (46.4%) reported proficiency in using electronic devices. The medical students encountered multiple challenges: approximately 88% indicated that anxiety over the possibility of contracting the disease led to changes in personal behavior and interactions with family and friends. The study also revealed that 71% exhibited anxiety traits, and 11% displayed depressive symptoms, which may have been pre-existing. Furthermore, 77.1% of the participants experienced poor sleep quality, which, according to another study, is a significant predictor of depression and anxiety during COVID-19. Our findings show a significant correlation between undergoing COVID-19 testing and increased anxiety and stress levels among students, most of whom were infected during the pandemic's second wave in India. Conclusion The study has shed light on the effect of the COVID-19 pandemic on MBBS scholars and the students' reactions to this unparalleled situation. This aligns with Sustainable Development Goal 3, which focuses on "good health and well-being." The medical community has been significantly impacted by the pandemic due to its frontline position, and medical students' struggles to thrive academically. The knowledge gained from this study will assist facilitators and students of the medical fraternity in carrying out effective teaching modalities during this pandemic and any future outbreaks.