The small-island effect (SIE) has become a widespread pattern in island biogeography and biodiversity research. However, in most previous studies only area is used for the detection of the SIE, while other causal factors such as habitat diversity is rarely considered. Therefore, the role of habitat diversity in generating SIEs is poorly known. Here, we compiled 86 global datasets that included the variables of habitat diversity, area and species richness to systematically investigate the prevalence and underlying factors determining the role of habitat diversity in generating SIEs. For each dataset, we used both path analysis and breakpoint regressions to identify the existence of an SIE. We collected a number of system characteristics and employed logistic regression models and an information-theoretic approach to determine which combination of variables was important in determining the role of habitat diversity in generating SIEs. Among the 61 datasets with adequate fits, habitat diversity was found to influence the detection of SIEs in 32 cases (52.5%) when using path analysis. By contrast, SIEs were detected in 26 of 61 cases (42.6%) using breakpoint regressions. Model selection and model-averaged parameter estimates showed that Number of sites, Habitat range and Species range were three key variables that determined the role of habitat diversity in generating SIEs. However, Area range, Taxon group and Site type received considerably less support. Our study demonstrates that the effect of habitat diversity on generating SIEs is quite prevalent. The inclusion of habitat diversity is important because it provides a causal factor for the detection of SIEs. We conclude that for a better understanding of the causes of SIEs, habitat diversity should be included in future studies.