[Objective] To assess how farmers’ participation in soil conservation programs affects their welfare, to provide theoretical support for the sustainable development of regional soil conservation. [Methods] We selected counties involved in soil and water conservation projects within the Three Gorges Reservoir area and constructed a welfare evaluation index system based on capability theory. We explored how farmers’ participation in such projects affects their welfare using methods including propensity score matching, fuzzy comprehensive evaluation and quantile regression. [Results] ① After participating in soil and water conservation programs, the welfare indices of the farming and living environments were 0.523 and 0.614, respectively. The happiness index of resident farmers was high, and subjective well-being indices, such as income satisfaction, were above 0.5. ② A marked difference in welfare outcomes was identified between farmers that participated in soil and water conservation and those who did not, with the total fuzzy welfare index of participating farmers being greater than that of non-participating farmers. ③ Soil conservation projects comprehensively improved the welfare level of farmers from economic, social and ecological perspectives, with a welfare effect of 2.75%—2.80%. ④ The overall welfare level of farmers’ families increased with an increasing extent of their participation in soil and water conservation projects. The total welfare generated by farmers’ spontaneous soil conservation behaviours was greater than that generated by government-guided soil and water conservation initiatives, although government-guided welfare was more significant in terms of crop yield and farming environments. Cultivated land area was the main factor affecting farmers’ participation in soil conservation welfare. [Conclusion] The promotion and training of soil conservation interventions should be strengthened, and regional characteristics should be considered when implementing soil and water conservation measures, so as to improve farmers’ participation in such projects and ensure that more farmers benefit from these conservation measures.