This study aimed to investigate the mediation role of coping with stress between psychological capital and teacher wellbeing based on positive psychology, conservation resource, and broaden-and-build theories. Participants in this study were 836 teachers from three clustered, ethnically diverse public universities. Our findings showed that, in line with previous studies, the psychological capital (PsyCap), coping with stress (CWS), and teacher well-being (TWB) dimensions showed the best fit in our data. PsyCap was related positively to TWB (total and dimensions), CWS, coping through withdrawal, and negative coping with acceptance and change. The indirect effect of PsyCap on TWB through coping with stress was fully mediated. PsyCap also positively and directly affected TWB and CWS. Coping through acceptance and change were fully mediated by PsyCap and TWB dimensions, while coping through withdrawal was not. PsyCap directly and positively affected coping with stress (acceptance and change) and negatively affected coping through withdrawal. Future theoretical and practical implications are discussed.