Child labor is perceived to be a severe problem as it is supposed to be destructive not only for intellectual and physical development of children but also for their life as a whole or their wellbeing especially that of young children. The danger is intensified for those children who work in hazardous industries like carpet industry. A child works for a variety of reasons, the most important being poverty and the induced pressure upon his/her to escape from this plight. The prime objective of the present research was to identify the factors contributing to child labor and effects of work-related issues on the wellbeing of carpet weavers. A cross sectional survey was conducted in three districts of Punjab i.e. Faisalabad, Sheikhupura and Toba Tek Singh selected where a sizable number of child carpet weavers were found by using the secondary data sources. A sample of 320 carpet child workers of age group 8-17 years from each locality and villages were selected randomly using the list of carpet household. Both quantitative and qualitative methods were used in order to get detailed information about the issue under study. For the quantitative approach, the information was collected through a well-structured questionnaire consisting of both closed ended and open ended questions. For qualitative approach, to get the detailed information about complex phenomenon of child labor focus group discussions with the parents and contractors were conducted. Descriptive statistics such as frequency distribution mean and standard deviation and inferential statistics such as chi-square, Gamma tests and regression analysis were applied to analyze the data for exploring the research objectives and hypotheses. The key findings of the descriptive analysis show that the majority of the respondent belong to the labor class, had a large family size, low family income and the main cause for not attending school and doing the value laden activity of carpet weaving was poverty. A huge majority 92 percent reported that they were assisting their parents in family income and that they cannot afford to go to school. The bi-variate analysis demonstrate that significant relationship between all socioeconomic factors and wok-related issues (i.e. age, monthly income, parent’s education, working hours, workplace conditions, employer’s behavior, child abuse and hazards) and the personal wellbeing of carpet working children. The multi-variate analysis results reveal that the most important and contributing socio-economic factors in explaining the satisfaction level of personal wellbeing of respondents were; monthly income, father’s education, parental health problem, and economic involvement of family members. It also emerged from the multivariate analysis that work-related issues like poor working conditions, long working hours, employer’s behavior child abuse and work-related 18 hazards also affect the personal wellbeing of respondents. From the focus groups discussions with parents it was found that the major cause of children’s involvement in hazardous work like carpet weaving was the parent’s inability to provide even basic needs to their family so they are forced to send their children to work instead of school. It is evident from the discussion that the parents are aware of the short and long term health impact like musculoskeletal disorders, respiratory disorders, injuries, eyesight problems, nerve disorders, skin problems of this work. It is suggested that a comprehensive strategy consisting of macro as well as micro policies has to be commenced to resolve the problem. In this context, different measures are suggested to control, reduce and eradicate the participation of children in the carpet weaving industry.