A comparative economic and life cycle based analysis of five management scenarios for the solid waste generated in the island of Syros was conducted. The LCA part was performed with the LCA – IWM software. The four on-site waste management scenarios were: i) source separation of recyclable materials in combination with landfill disposal of the residuals (existing situation), ii) aerobic, windrow type, biological treatment (composting) with landfilling of residues, iii) anaerobic biological treatment (digestion) with landfilling of residues iv) aerobic mechanical biological treatment (MBT) and landfilling of residues. The off-site management scenario examined the transportation of the whole commingled wastes off the island for processing and disposal to the main mechanical and biological pretreatment plant in Athens. The results of analysis showed that the optimum waste management scenario in terms of environmental burdens (based on six environmental impact categories) and economics was off-site transportation, even when the specific landfill tax is included in calculations. The second best scenario in terms of environmental performance included the on-site aerobic MBT plant while the worst scenario was direct landfilling with mixed dry recyclables’ recycling. On-site anaerobic digestion had less environmental burdens and was more expensive than open windrow composting. Threshold distances were calculated below which the transportation of municipal solid wastes from a small island is financially and environmentally beneficial.