The aim of this thesis was to do research on how some of the psychosocial factors relate to the life satisfaction of the elderly and also to examine the possibility of predicting life satisfaction of the elderly based on the observed psychosocial factors. There were 167 participants in the research, 134 were female and 33 male. The participants were residents of 11 different retirement homes in Zagreb and their average age was M=84.47 years. In every facility all the participants responded to a structured interview on their sociodemographic data, social support, social participation, self-perceived health, functional ability and life satisfaction. Gender differences were found in social participation and functional ability. Women were more involved in social activities, while men achieved better results on the functional ability scale. In addition, the results showed that there was a significant moderately strong positive correlation between life satisfaction and the overall self-perceived health and functional ability. By means of the linear regression analysis it was deduced that age, social support, social participation, self-perceived health and functional ability all significantly predict 19% of the life satisfaction variance. Self-perceived health has shown to be the only significant predictor of life satisfaction of the elderly.