Cocoa agroecosystems are a major land-use type in the tropical rainforest belt of West Africa, reportedly associated with several ecological changes, including soil degradation. This study aims to develop a composite soil degradation assessment index (CSDI) for determining the degradation level of cocoa soils under smallholder agroecosystems of southwestern Nigeria. Plots where natural forests have been converted to cocoa agroecosystems of ages 1-10, 11-40, and 41-80 years, respectively representing young cocoa plantations (YCPs), mature cocoa plantations (MCPs), and senescent cocoa plantations (SCPs), were identified to represent the biological cycle of the cocoa tree. Soil samples were collected at a depth of 0 to 20cm in each plot and analysed in terms of their physical, chemical, and biological properties. Factor analysis of soil data revealed four major interacting soil degradation processes: Decline in soil nutrients, loss of soil organic matter, increase in soil acidity, and the breakdown of soil textural characteristics over time. These processes were represented by eight soil properties (extractable zinc, silt, soil organic matter (SOM), cation exchange capacity (CEC), available phosphorus, total porosity, pH, and clay content). These soil properties were subjected to forward stepwise discriminant analysis (STEPDA), and the result showed that four soil properties (extractable zinc, cation exchange capacity, SOM, and clay content) are the most useful in separating the studied soils into YCP, MCP, and SCP. In this way, we have sufficiently eliminated redundancy in the final selection of soil degradation indicators. Based on these four soil parameters, a CSDI was developed and used to classify selected cocoa soils into three different classes of degradation. The results revealed that 65% of the selected cocoa farms are moderately degraded, while 18% have a high degradation status. The numerical value of the CSDI as an objective index of soil degradation under cocoa agroecosystems was statistically validated. The results of this study reveal that soil management should promote activities that help to increase organic matter and reduce Zn deficiency over the cocoa growth cycle. Finally, the newly developed CSDI can provide an early warning of soil degradation processes and help farmers and extension officers to implement rehabilitation practices on degraded cocoa soils.