This work proposes a holistic landscape assessment methodology, with novel and practical tools, which can support sustainable landscape development for small islands. The Greek island of Gavdos is the case study. An Islandscape character assessment was developed and applied, through a series of maps, extensive data collection and field work visits. A participatory spatial SWOT analysis enabled stakeholders to visualize their ideas concerning landscape types of the island. Aided by a compatibility matrix, each development priority was considered in relation to islandscape types, and landscape design guidelines were derived. The results showed a consensus between experts and stakeholders regarding the islandscape types and the planning of development priorities. The analysis of each islandscape type revealed the guidelines that should be followed in a future local spatial plan, regarding settlements expansion, tourism development, agriculture revival, environmental protection, coastline and water preservation and road network integration to the landscape. This methodology is an aid decision-making tool for land use policy, planning, design and management of islandscapes, guiding experts to compatible development priorities and stakeholders to more sustainable solutions regarding the socio-economic, heritage and ecological value of their island.