The holistic and systematic comprehension of service well-being is garnering increasing attention among scholars. The holistic understanding of Service well-being is significant since it helps to clarify the multi-actor and multi-level nature of complex services, such as IT services. The majority of research conducted in the IT service field primarily examines individual and micro-level interactions, neglecting the significance of a comprehensive and systemic perspective on service well-being. The study discussed in this article aims to overcome these constraints by examining the well-being of IT services from a “service ecosystem” standpoint. The research used an interpretative approach to construct a middle-range theory using a case study and grounded theory methodology within a higher education institution. The results uncover the factors that contribute to well-being and the effects on several levels of the IT service ecosystem (Micro, Meso and Macro) including Service encounter, Service facilitation, and Service integration levels. This study enhances the existing research on well-being in the IT service context by presenting a holistic framework for service ecosystem well-being which has significant theoretical and practical contributions.