The majority of municipal solid waste in Thailand is organic waste including food and garden waste. Improper waste management has caused negative impacts on the environment. This study aimed to find a hypothetical municipal organic waste management scenario with the lowest environmental impacts using life cycle assessment (LCA). The system boundary of organic waste management includes collection and transportation; treatment, including centralized and on-site treatment technologies; and by-product utilization. The two main waste management systems considered in this study were centralized and on-site waste management systems. The first two scenarios take into account all the amount of the municipal organic waste collected and transported and then treated by centralized waste treatment technologies (composting, anaerobic digestion, and landfill). The remaining three scenarios are integrated between 10% on-site (home composting, food waste processor, and composting bin) and 90% centralized (composting, anaerobic digestion, and incineration) waste treatment technologies; the scenario combining centralized (food waste anaerobic digestion, garden waste composting, and incineration) and on-site (home composting) systems yielded the lowest environmental impacts (except short-term climate change, freshwater, and marine eutrophication). On-site systems can help reduce collection, transportation, and treatment impacts, particularly photochemical oxidant formation, which was proportional to the amount of waste or distance reduced. Benefits from the by-product utilization can offset all impacts in terms of fossil and nuclear energy use and freshwater acidification, and result in a negative impact score or impact reduction. This research can be used as guidance for developing countries with conditions and waste composition similar to Thailand for making initial decisions on environmentally sustainable municipal organic waste management.