(1) Background: Fear of movement (kinesiophobia) and impaired lumbar joint position sense (LJPS) play a vital role in developing and maintaining non-specific chronic low back pain (CLBP). However, how kinesiophobia impacts LJPS is still being determined. The aims of this study are to (1) assess the correlation between kinesiophobia and LJPS in individuals with chronic low back pain; (2) compare LJPS between individuals with CLBP and those who are asymptomatic; and (3) evaluate if pain can mediate the relationship between kinesiophobia and LJPS in CLBP individuals. (2) Methods: Eighty-three individuals (mean age = 48.9 ± 7.5 years) with a diagnosis of CLBP and 95 asymptomatic individuals (mean age = 49.4 ± 7.0 years) were recruited into this cross-sectional study. Fear of movement in CLBP individuals was assessed using the Tampa Scale for Kinesiophobia (TSK). LJPS was determined using the active target repositioning technique using a dual-digital inclinometer. LJPS was evaluated in lumbar flexion, extension, and side-bending left and right directions, and the repositioning accuracy was determined in degrees using a dual digital inclinometer. (3) Results: Kinesiophobia showed a significant ( < 0.001) moderate positive correlation with LJPS (flexion: r = 0.51, extension: r = 0.41, side-bending left: r = 0.37 and side-bending right: r = 0.34). LJPS errors were larger in CLBP individuals compared to asymptomatic individuals ( < 0.05). Mediation analyses showed that pain significantly mediated the relationship between kinesiophobia and LJPS ( < 0.05) in CLBP individuals. (4) Conclusions: Kinesiophobia and LJPS were positively associated. LJPS is impaired in CLBP individuals compared to asymptomatic individuals. Pain may mediate adverse effects on LJPS. These factors must be taken into account when assessing and developing treatment plans for those with CLBP.