This study aimed to examine the relationships among parentification, self-compassion, and forgiveness of parents among university students. Participants were 309 undergraduate students from various institutions in Taiwan, recruited through an online survey. Measures included the Parentification Scale, Self-Compassion Scale, Forgiveness of Parents Scale, and Parent–Child Relationship Scale. Data were analyzed using SPSS 26.0 for descriptive statistics, t-tests, one-way multivariate analysis of variance, Pearson’s correlation, and PROCESS macro for hypothesis testing. Results indicated that: (1) the overall level of parentification among participants was moderately high, with the most frequently assumed roles being “parent of the parents” and “nonspecific family responsibilities,” and the highest emotional score observed in “shame and guilt.” First-born and middle-born students reported significantly higher parentification levels than only children; (2) parentification was negatively associated with forgiveness of parents, whereas forgiveness of parents was positively associated with the parent–child relationship and fully mediated the link between parentification and the parent–child relationship; (3) self-compassion effectively buffered the negative effect of parentification on forgiveness of parents and, in the moderated mediation model, attenuated the adverse indirect effect of parentification on the parent–child relationship through reduced forgiveness of parents. Overall, this study underscores the role of self-compassion as a vital positive psychological resource and suggests that higher education counseling and guidance services should integrate cultural values with individual needs to help parentified students find balance between family responsibilities and personal growth, fostering a transformative process from trauma bearing to relationship repair.