Artificial Intelligence (AI) has emerged as a major technological advancement influencing various sectors, including Library and Information Science. Among recent AI innovations, ChatGPT, developed by OpenAI, has attracted considerable attention because of its ability to generate human-like responses and provide interactive information services. The present study examines the development, applications, and impact of ChatGPT on library users and modern library services. The study is descriptive and analytical in nature and is based on secondary data collected from books, journal articles, reports, and scholarly databases. The paper discusses the historical development of ChatGPT, its role in digital libraries, changing reading behavior, and the transformation of library services through AI technologies. The findings indicate that ChatGPT improves information accessibility, enhances research support, and strengthens user engagement. However, concerns relating to information reliability, ethical use, privacy, and overdependence on technology continue to remain important challenges. The study concludes that ChatGPT should function as a supportive tool alongside professional librarians in order to create efficient, user-centered, and technologically balanced library systems.