Ecosystem goods and services (EGS) are of crucial importance for the production of commodities and for the economic and social development of human communities. The well-established Life Cycle Assessment (LCA) method is facing a number of challenging improvements to define new characterization factors (CF) for Life Cycle Impact Assessment (LCIA) of EGS, since the evaluation of EGS in LCA has been typically focused only to a few ‘provisional’ services (e.g. fossil fuels, wooden resources, renewable energy, minerals, freshwater, land use and some biodiversity issues), neglecting to account for ‘regulating’ and ‘supporting’ services (e.g. air quality, water and climate regulation, nutrient cycles, erosion, pests and diseases; pollination; soil formation; photosynthesis) as well as ‘aesthetic’ ones (e.g. cultural diversity, spiritual and religious values). Based on this framework, it is clear that the end-point damage LCIA model with regard to natural resources and ecosystem health does not comprehensively cover the evaluation of several EGS. Despite valuable attempts to harmonize land use inventories with impact indicators have been recently advanced in LCA to cover this modelling gap, the implemented methods still only assess a potential impact at the mid-point level, whereas the actual damage to ecosystem functionality and its relation to EGS supply and pressure remain undefined.VALUES aims at defining a new physical-economic characterization method for LCIA of biodiversity and ecosystem services based on the calculation of the marginal contribution of EGS to the human production and welfare functions. This modelling approach, based on the combination between an existing dynamic ecological model (MIMES) and LCIA, will enable to evaluate (in the short- to long-term) the contribution of EGS to support human economies. The integrated model will allow both a quantitative and qualitative evaluation of the economic and environmental trade-offs and synergies due to the exploitation of EGS, which ultimately can influence the ecosystems functionality and biodiversity, and the social-economic benefits and welfare for humans. Several simulations under different economic and social conditions of future scenarios will be run computing CF of EGS at global scale (in marginal price values, i.e. Monetary/Physical unit of EGS), while a downscaling analysis in MIMES will be also conducted to explicitly quantify the CF of two regulating services (carbon sequestration and pollination) at the regional scale of Luxembourg’s agricultural sector. Accordingly, VALUES will allow developing an operational modelling framework for LCIA to retrieve spatially- and temporally-explicit CF of EGS at a global, multi-regional scale, and, as a case study for validation purposes, applying this framework to derive CF of carbon sequestration and pollination and to assess their impact within the LCA of cropping systems in Luxembourg.