This study examines how over-education is associated with life satisfaction among university-educated immigrant and non-immigrant workers in Canada, and accounts for differences in the degree of over-education in each group. Results indicate that over-education was negatively associated with life satisfaction among immigrants and non-immigrants, although the effect was weaker in the immigrant population. Income was the main factor mediating the negative relationship between over-education and life satisfaction among immigrants. Furthermore, this relationship weakened with immigrants’ increased residence in Canada. This may suggest that over-education is less influential in immigrants’ assessment of life satisfaction over time, or the effect of over-education is weaker among earlier arrival cohorts. Results also indicated that the negative relationship between over-education and life satisfaction was weaker for immigrants from developing countries compared with those from developed countries.