This study examines the relationship between banking sector financial stability, credit expansion, inflation, and economic growth in Türkiye using annual data for the period 2002–2024. Financial stability is proxied by the bank Z-score, which reflects the resilience of the banking sector against insolvency risk. Credit expansion is measured by domestic credit to the private sector as a share of GDP, while inflation and economic growth are included to capture the broader macroeconomic environment in which financial stability evolves. The empirical analysis employs the Autoregressive Distributed Lag (ARDL) approach, which allows for the joint estimation of short- and long-run dynamics among variables with mixed orders of integration. To assess whether the effects of credit expansion and inflation on financial stability differ during periods of increases and decreases, a Nonlinear ARDL (NARDL) framework is also applied. In addition, the Toda–Yamamoto causality test is used to investigate the direction of interactions among the variables without imposing restrictive assumptions regarding their integration properties. The results indicate that credit expansion and inflation exert statistically significant and negative effects on financial stability in both the short and long run. Economic growth, by contrast, is found to support financial stability, although its impact remains relatively modest. Evidence from the NARDL model suggests that positive shocks to credit and inflation weaken financial stability more strongly than negative shocks, pointing to an asymmetric adjustment process. The causality analysis reveals unidirectional causal links running from credit expansion, inflation, and economic growth to financial stability. Overall, the findings suggest that financial stability in Türkiye is highly sensitive to macro-financial conditions, highlighting the importance of jointly considering credit dynamics and price stability within the policy framework.