The Louisiana Department of Transportation and Development (LaDOTD) has been using thin asphalt overlay (2 in.) as a preservation technique for asphalt-surface pavements. Although LaDOTD has specified the triggers for its application, it was not always applied on the recommended timing. It is unclear how the application timing affects the overlay performance. Additionally, no studies have been conducted to determine optimal application timing for the overlay and predict its performance using the available tools such as AASHTOWare Pavement Mechanistic-empirical design (Pavement ME) software. The objectives of the study are (1) to evaluate field performance of the preservation asphalt overlay and develop performance prediction models, (2) to determine optimal application timing for the overlay, and (3) to investigate if Pavement ME models are able to predict performance of the overlay by modifying model coefficients. To achieve the objectives, 33 preservation asphalt overlay projects were selected, and their performance was evaluated and predicted, then the optimal application timing was investigated based on the benefit and cost analysis. The results indicate that 58% of the preservation asphalt overlays had 10–20 years’ service life, and 42% had 7–10 years’ service life in relation to Pavement Condition Index threshold of 70. Additionally, good precondition or flexible base (asphalt concrete or unbounded base) can result in a longer service life in the overlay. It is also found that an average value of optimal timing of the next overlay application is the 9th year after construction. Finally, the rehabilitation models of asphalt overlay in Pavement ME software could be used for preservation asphalt overlay by modifying model coefficients.