Life satisfaction is a critical indicator of student development. Although several longitudinal studies have examined the predictors of life satisfaction, this study has several unique strengths. First, it examines hope (i.e., a positive motivation and power for success and happiness) as a possible mediator variable. Second, it separates between-person effects (i.e., people with hope perceive higher life satisfaction than those who are less hope) and within-person effects (i.e., a person with hope perceives higher life satisfaction over time). Participants were 1108 Chinese adolescents aged 14–18 years (M = 15.89, SD = 0.68, 57.7% boys). Multilevel statistical models were used to disaggregate between- and within-person effects. Results showed that teacher–student relationships were positively associated with hope and life satisfaction and that hope was positively associated with life satisfaction. These associations were significant both at one point in time (between-person effect) and over time (within-person effect). Moreover, at both the between- and within-person levels hope was found to be a significant mediator of the association between teacher–student relationships and life satisfaction. That is, within a given individual, a more favorable perceived teacher–student relationship at a given time point was a significant positive predictor of hope for that individual, and in turn, hope was associated with significantly greater life satisfaction at that particular time point. Identification of hope as an explanatory mechanism in the association between teacher–student relationships and life satisfaction in Chinese adolescents provides a potential target for interventions to improve students’ well-being.