This study aimed at identifying relationships between occupational factors and health and well-being among individuals with persistent mental illness. There were 103 subjects assessed in regards to time spent in different occupations, activity level, satisfaction with daily occupations, and experienced occupational value. The health-related variables were self-rated health, quality of life, self-esteem, sense of coherence, self-mastery, psychosocial functioning, and psychiatric symptoms. Subjective perceptions of occupational performance were consistently related to both self-rated and interviewer-rated aspects of health and functioning. While variables pertaining to actual doing showed weak or no associations with self-rated health-related variables, they exhibited moderate relationships to interviewer-rated health and functioning. The results indicated that the health-promoting ingredients in occupations were determined by the way occupations were perceived, rather than the doing per se. The findings indicate that perceived meaning and satisfaction ought to be prioritized when setting goals in occupational therapy practice, and, besides, that existing occupational therapy theory needs to be updated.