Well-being is a complex multidimensional concept defined as a state of being happy, healthy and prosperous. Generally, well-being is geographically not evenly distributed within a country. Major differences in well-being among territorial units at subnational level impede the progress of society and may cause economic, social, urban, environmental and political problems. Acknowledging of regional differences in well-being is of key importance for efficient planning and implementation of regional and spatial policy measures. The principal objective of these policies is balanced regional development proven by diminishing differences in economic development and well-being. The paper deals with the measurement of geographical differences of well-being in Slovenia using composite indicators based on principal components. Municipalities were selected as basic units, since presently municipality is the only type of subnational government in Slovenia. They represent the level of government closest to people that provides local public services to community. Well-being was defined by 49 quantitative social, economic, demographic and environmental indicators. The indicators were selected on the basis of relevance for well-being and data availability at the municipality level. In order to verify the validity of the measurement of well being using composite indicators and to enhance the interpretability and usability of the results, several approaches based on multivariate analysis were applied. All approaches clearly show substantial differences in the level of wellbeing of municipalities with prevailing higher level in the Western and lower level in the Eastern part of Slovenia. Besides that, cluster analysis has revealed dual nature of the top well-being group of municipalities. On one side, there is a subgroup of a socially most developed urban centres. On the other side, well-being of the second subgroup of municipalities is characterized by high standards of living and pleasant environmental conditions, although being a step behind on the economic and social scale.