There is mounting evidence that psychosocial safety climate (PSC) is positively associated with employees' mental well‐being and negatively associated with burnout. Drawing on a crafting perspective, we hypothesized that these relationships are mediated by both on‐job and off‐job crafting. We further hypothesized that organizational identification moderates the relationship between PSC and crafting, constituting a first‐stage moderated mediation model. In a pre‐registered, time‐lagged study with three measurement waves, we collected data from 266 employees. As predicted, PSC was positively related to mental well‐being and negatively to both disengagement and emotional exhaustion. Supporting our hypotheses, on‐job crafting mediated the relationships between PSC and mental well‐being, and between PSC and disengagement, but not emotional exhaustion. Off‐job crafting, in turn, mediated the relationships between PSC and both well‐being and emotional exhaustion, but not disengagement. Although organizational identification did not moderate indirect effects via on‐job crafting, it did moderate the mediation pathways through off‐job crafting for both mental well‐being and emotional exhaustion, but not disengagement. In conclusion, our study advances PSC research by integrating a job crafting lens and by identifying organizational identification as a key boundary condition influencing PSC's effectiveness.