Background: Lung cancer as a stressful event profoundly impacts the entire family, especially patients and their family caregivers. Methods: This study uses a dyadic analysis approach to explore the dyadic effects of family functioning on the quality of life (QoL), and whether resilience acts as a mediator in advanced lung cancer patient-caregiver dyads. This was a cross-sectional study, and 287 dyads of advanced lung cancer patients and their caregivers were enrolled. Family-functioning, resilience, and QoL were assessed by the General Functioning subscale of the Family Assessment Device (FAD), the 10-item Connor-Davidson Resilience Scale, and the Short Form-8 (SF-8) Health Survey, respectively. Data were analyzed using the actor-partner interdependence mediation model. Results: This study found that, for patients and caregivers, resilience mediates the actor effects of family-functioning on QoL. That is, family-functioning was positively related to their resilience, which improved QoL. Another important finding is that caregivers' family-functioning had significant indirect effects on patients' QoL through their resilience. Positive family functioning perceived by patients and caregivers can improve their QoL by developing their own resilience. Furthermore, family-functioning perceived by caregivers can also improve patients' QoL through their resilience. Medical staff should identify vulnerable patients and caregivers with poorer family-functioning and resilience, and make focused intervention to improve the QoL of both lung cancer patients and their family caregivers. Conclusions: Positive family functioning perceived by patient-caregiver dyads can improve their QoL by developing their resilience. Family-functioning perceived by caregivers can also improve patients' QoL through their resilience.