Background <p>Rare diseases impose significant burden on families, particularly parents, of affected children, involving intensive caregiving, financial hardship, and social isolation. However, there is a scarcity of research exploring the broader dimensions of parental wellbeing, such as enjoyment and achievement. This study aims to assess the capability wellbeing among parents caring for children with rare diseases and to identify the contributing factors of parental wellbeing.</p> Methods <p>A nationwide cross-sectional survey was conducted on 10,207 parents of children diagnosed with 28 different rare diseases in China in 2019–2020. The survey collected disease-related factors of the children and socio-demographic and psychosocial factors of parents. The capability wellbeing of parents was measured using the ICEpop CAPability Instrument for Adults (ICECAP-A), with a score ranging from 0 (no capability) to 1 (full capability). Multivariable linear regression was employed to identify factors associated with parental capability wellbeing.</p> Results <p>Parents demonstrated impaired capability wellbeing (ICECAP-A mean score: 0.64), particularly in abilities related to stability, achievement, and autonomy. Mothers (ICECAP-A mean score 0.63) reported poorer wellbeing than fathers (ICECAP-A mean score 0.64). Severe disease condition, lack of treatment, diagnostic delay in children, low socio-economic status, lack of social support, financial burden, and work disruption among parents were found to undermine parental capability wellbeing.</p> Conclusion <p>Parents caring for children with rare diseases face multifaceted challenges that negatively affect their overall capability wellbeing, particularly in areas of stability, achievement, and autonomy. Gender-specific challenges call for tailored services and support for mothers and fathers.</p>