This article analyzes the relationship between subjective well-being (SWB) and participation in neighborhood associations (NHA) in Japan. While the theoretical and empirical literature suggests a strong positive correlation between participation in NHAs and SWB, recent research on Japan could not validate this result. This study shows how those diverging results can be explained by including two factors in the analysis: the voluntariness of the action as well as loneliness as a mediating variable. Using linear regression models on data from two different studies, we find that—even in the case of Japan—voluntary participation in NHAs is positively associated with SWB in two ways: directly and indirectly mediated by loneliness. This result is robust to differently sampled data and different measures of our key variables.