The aim of this thesis was to investigate how older people’s capacity to perform activities of daily living (ADL), health, social and financial resources, and self-esteem can be related to their life satisfaction. The aim was also to investigate how people feel hindered by health problems in relation to their ADL capacity, health problems, social and financial resources, self-esteem, sense of coherence, and life satisfaction. The thesis focused on people 60–96 years of age in six European countries, living at home. The data were collected in two cross-sectional studies, using standardised self-reported questionnaires and a medical examination. The first study (papers I, II and III) included people in six European countries (Sweden, the UK, the Netherlands, Luxembourg, Austria, and Italy) who participated in the European Study of Adult Well-being (ESAW) in 2001 to 2002. Paper I included people (n = 7699) aged 60−89 in all six countries, Paper II included people with reduced ADL capacity (n = 2195), and Paper III included people living in Sweden (n = 1297) with at least one health problem. In the ESAW, questions from the Older Americans Resources and Services schedule, (OARS), the Life Satisfaction Index Z (LSIZ) and Rosenberg’s Self-Esteem Scale were used. The other study (Paper IV) included people (n = 958) aged 60−96 years of age who participated in a baseline survey in one of the four centres (Blekinge) of the longitudinal multi-centre cohort study named The Swedish National study on Aging and Care (SNAC) in 2001. Established questions and instruments were used to collect the data, and quantitative descriptive statistics, comparative statistics and multiple regressions were used when analysing the data. In all ESAW country samples, factors such as feeling hindered by health problems, low social and financial resources, and low self-esteem played a crucial role in creating conditions for low life satisfaction. It is also possible to identify both common and country-specific factors influential for life satisfaction in the six European countries. The analysis furthermore revealed that personal as well as environmental factors were important, though personal factors were more important for life satisfaction than environmental factors among people with impaired ADL capacity. Among those with impaired ADL capacity in the six national samples, people afflicted by poor overall health and people who were feeling worried and had low self-esteem suffered an increased risk of low life satisfaction in all countries. At the same time, social and financial resources had an impact on life satisfaction in four countries. Results suggest that self-esteem and perceived health are of universal importance for life satisfaction irrespective of ADL capacity, and these phenomena are thus essential to target in health care interventions. Furthermore, feeling hindered by health problems in daily living, rather than the impairment in ADL capacity, appears to increase the risk for low life satisfaction. In addition to this, people felt hindered by their problems although they had excellent ADL capacity. Several factors contributed to people feeling hindered, and the importance of these factors differed according to the level of the ADL capacity of the individual. The results suggest that people seemingly re-evaluate the importance of their resources when health declines, making certain activities in daily life more important than others.