Social anhedonia is associated with reduced social functioning and diminished reward from social interactions. Individuals expressing social anhedonia are likely to experience reduced social connectedness and feel lonely. Loneliness is also associated with reduced social functioning. Therefore, loneliness could account for the relationship between social anhedonia and social functioning. We aimed to determine whether loneliness mediates the relationship between social anhedonia and reduced social functioning. In total, 824 young adults (M age = 21.03, SD = 5.59; 72.3% female) completed the Revised-Social Anhedonia Scale (RSAS), University of California Los Angeles (UCLA) Loneliness Scale, and the Social Functioning Scale (SFS). Scores on thee SFS were summed into six subscales: Social Withdrawal, Relationships, Social Activities, Recreational Activities, Independence (Competence), and Independence (Performance). Negative affect (Depression, Anxiety and Stress Scales-21 [DASS] total score) was included as a covariate. Both the RSAS and the UCLA Loneliness Scale were negatively correlated with overall and all social functioning subscales. The DASS-21 positively correlated with all variables of interest. Mediation analyses revealed that loneliness partially mediated the relationship between social anhedonia and the social functioning subscales, with the exception of Recreational Activities. However, loneliness was a full mediator for the relationship between social anhedonia and overall social functioning. The study findings suggest that targeting loneliness in interventions may be important for improving various aspects of social functioning in those individuals who express social anhedonia.