Despite evidence attesting to positive psychological effects of meditation, little is known about how variance in the level of engagement with meditation actually relates to positive outcomes. This study draws on multiple traditional and contemporary theoretical frameworks to (1) uncover fundamental aspects of variability in meditation practice, (2) test the role of several primary and secondary processes believed to be responsible for positive effects, and (3) explore a range of positive and negative outcomes believed to be closely aligned with the original intended outcomes of meditation practices. Using two large (each N > 500) heterogeneous samples of meditation practitioners, this study calibrated and then cross-validated a theoretical model testing the plausibility of several causal pathways linking variation in experience with meditation to positive and negative psychological outcomes. Results showed that individual differences in meditation involve both behavioral aspects accounting for the degree of engagement, and psychological aspects incorporating the intensity or depth of this engagement. Variation in these aspects accounts for large proportions of variance in psychological health and functioning outcomes. Several factors representing attention refinement (mindfulness), changes in self-perception and outlook (transcendence), worldview (insight), and psychological development serve as plausible change mechanisms serving to transmit the effects of meditation on psychological health and functioning.