Recognizing and understanding the subjective wellbeing (SWB) of individuals is essential for designing effective policies that promote human development and the sustainable management of social-ecological systems (SES). This is particularly important for smallholders, critical stewards of biodiversity who face acute livelihood challenges. This article explores how smallholders inhabiting tropical dry forests in Mexico perceive their SWB and how it changes across a spectrum of SES that undergo different land transformations, management intensities, and governance dynamics. Our aims are to identify the dimensions of SWB that smallholders perceive, understand how these dimensions change across SES, and examine how smallholders’ perceptions of fulfilled material and non-material dimensions vary across SES. We analyzed the content of 25 in-depth interviews with farmers and identified 48 SWB items belonging to six categories: (1) social capital, (2) economic capital, (3) agency, (4) nature, (5) pleasant non-work activities, and (6) governmental services, and two additional dimensions referred to obstacles and enablers. We found two prevailing visions of SWB: ‘living well’ prevails especially in areas with communal governance and medium management intensity, and ‘need to earn more’ prevails in areas with individual governance and intensified land management. As management is intensified and governance fosters individualism, the lower the self-perceived material and non-material satisfaction. We discuss the different SWB found per SES, as well as strategies that can foster smallholder’s SWB and SES dynamics that can motivate different conservation goals and sustainable uses of nature, especially in biodiverse areas.