The index, developed by the Social Progress Imperative, a US non-profit group, gauges factors such as healthcare, education, safety, personal freedoms and access to food, water and shelter to assess what makes a country a good place to live.
The Social Progress Index 2015 scored 133 countries with available data, aiming to give a different assessment of the wealth of a country than its Gross Domestic Product.
Denmark was the strongest in 'personal freedom and choice' within the category of 'opportunity', but was still weak in terms of access to advanced education.
The country also performed well in access to basic knowledge, but lagged behind in ecosystem sustainability in the section on the 'foundations of well-being'.
Within the category of basic human needs, Denmark scored the highest in water and sanitation, but had room to improve as far as providing shelter, according to the report.
The Danes ranked 11th for tolerance of homosexuals, one place below the United Kingdom at tenth place and above the United States at 15th place.
Denmark also sank to 12th place for tolerance of immigrants, right behind the United States at 11th place, but still higher than the United Kingdom at 16th place.
"To truly advance social progress, we must learn to measure it, comprehensively and rigorously," the report stated.
"The Social Progress Index offers a rich framework for measuring the multiple dimensions of social progress, benchmarking success, and catalyzing greater human wellbeing."
Nordic countries all ranked within the top ten of the overall ratings, with Denmark falling right behind Finland, at seventh place, as well as Iceland at fourth.
Among the countries with the world’s biggest economies, the UK ranks 11th in the index, ahead of Germany (14th), the US (16th) and Spain (20th) with France falling out of the top 20 in 21st place.
The Central African Republic ranks at the bottom of the index, ahead of Chad, Afghanistan, Guinea and Angola.
However, 28 countries could not be fully evaluated because of lack of data.
Here are the top ten countries in the index: