Facing the difficulties of satisfying diverse requirements from end-users, the developers of smart product-service systems (smart PSS) have to carefully allocate the priority order of design requirements (DRs). To cope with the diversity and uncertainty of the design requirements of smart PSS, a hybrid Multi-criteria decision-making (MCDM) method based on Probabilistic Linguistic Terms Set (PLTS) is developed. Individual customer requirements are aggregated using PLTS to reduce the influence of vagueness. The subjective importance of customer requirements (CRs) is calculated using PLTS-based Best Worst Method (BWM) to reduce the pairwise comparisons among CRs and the calculation complexity. The subjective importance is combined with the objective importance gained by the Maximum Deviation Method (MDM) to deal with the subjectivity of assessment. Finally, TODIM is used to calculate the ranking values of DRs to handle the bounded rationality of decision makers. The method can handle both qualitative and quantitative criteria and incorporate the linguistic preferences of different stakeholders. The effectiveness and efficiency of the hybrid method are verified in the development of an e-health app to satisfy diverse end-users’ needs in the scenario of assisting home-living elderly care.