Social capital has previously been reviewed in relation to mental health. However, none have focused specifically on positive aspects of mental health such as mental well-being. This review aimed to explore the relationship between social capital and mental well-being in older people. Ten relevant databases were systematically searched using an extensive search strategy for studies, analyzing the link between social capital and mental well-being. Criteria for inclusion in the systematic review were: the study sample included older people (≥50 years); the study reported a mental well-being outcome; social capital was an exposure variable; and empirical research using quantitative methods and published in English, between January 1990 and September 2011. Eleven studies met the inclusion criteria. Each study was assessed against seven possible exposure measures (structural, cognitive; bonding, bridging, linking; individual, collective). The results showed that all included studies found positive associations between parts of social capital and aspects of mental well-being. Typically, the relationship between social capital and mental well-being differed within as well as between studies. Our results highlight that there is no ‘gold standard’ of how to measure social capital or mental well-being. Social capital is generated in the interaction between individual and collective life. A possibility for future research is therefore to follow Bronfenbrenner's classical division into macro, meso, and micro levels. We consider family and friends at the micro level to be the key factors in generating social capital and well-being in older people.