This paper reviews the relationship between objective and subjective quality of life indicators. It proposes that the interaction of these variables occurs within a system that homeostatically maintains subjective quality of life within a narrow range. Due to the capacity of this system to adapt to varying environmental circumstances, the objective and subjective indicators are normally poorly correlated. However, it is also proposed that very poor objective conditions can defeat homeostasis and, once this occurs, the objective and subjective indicators display stronger covariation. Empirical data are provided to support this model and the implications for understanding the QOL construct are discussed.