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Digital technology have changed the way university students approach learning because it has become a necessity and an integral part of their lives. University students are accustomed to using their digital devices for almost anything such as communication, collaboration, accessing multiple source of information for solutions, etc. Although these digital generation are undeniably engaged with technologies and they are very comfortable and confident using technology to accomplish tasks, many educators tend to assume that students today have digital literacy. Surprisingly, current studies reveal that students do not have the required digital literacy skills for online learning. Furthermore, scholars mentioned that individuals level of digital literacy affects a student-s performance positively. This paper presents the deficiencies of digital literacy among university students in a digital learning environment in higher education, implications of these deficiencies and suggests some measures to reduce these deficiencies.