The ranking evaluates 450 locations globally on factors including climate, availability of health services, housing, infrastructure, personal safety, political tensions and air quality.
Recent socio-political instability has tarnished Hong Kong's appeal as a place to live and work, with the city falling 16 spots to the 33rd position on human resource consulting firm ECA International's 2015 Location Rating Survey published on Thursday.
"Hong Kong scores well in a range of factors including infrastructure, education and healthcare facilities, and availability of goods and services," said Lee Quane, regional director, Asia at ECA International.
"However, air quality remains a lot poorer there than many other parts of the region. In addition, Hong Kong's socio-political score worsened this year as a result of the unprecedented unrest there in recent months and the restrictions placed on movement."
Pro-democracy protests that spanned from September to December and involved tens of thousands of residents, blocked off major roads, disrupting commuters and businesses and bringing parts of the city to a standstill last year.
The top 10
Nine of the top 10 most livable cities are situated in Asia-Pacific, with the majority in Australia and Japan.
"Australia and Japan are among most developed locations in the world, with first class infrastructure and very good quality of living," said Quane.
Singapore, Adelaide, Sydney, Osaka and Brisbane ranked as the top five, followed by Wellington, Canberra, Copenhagen, Nagoya and Perth.
"The fact that Singapore comes out top time and time again does make it a very attractive proposition for companies looking to set up in the region, particularly when conditions in Hong Kong have deteriorated a little," said Quane.
"Nevertheless, it is important to put this into perspective. Overall the SAR [Special Administrative Region] does still remain one of the easier places in the world for an outsider to adjust to living and working in."
Good air quality, solid infrastructure, world class medical facilities and low crime have contributed to Singapore maintaining its crown as the world's most livable city.