This paper proposes the Falah Development Index (FalahDI) as a multidimensional framework for measuring societal prosperity within the ethical paradigm of Islamic economics. The index seeks to address the limitations of conventional development indicators such as Gross Domestic Product (GDP), which focus primarily on economic output while overlooking ethical, social, and spiritual dimensions of human well-being. The study adopts a conceptual research approach based on normative analysis of Islamic economic principles and contemporary development literature. Drawing on the objectives of maqasid al-Shariah, the paper develops a multidimensional index framework integrating economic justice, social welfare, financial inclusion, environmental stewardship, governance integrity, and spiritual development. The proposed model combines conventional socio-economic indicators with Islamic-specific measures related to social finance institutions. The study presents the conceptual structure and measurement framework of the FalahDI, demonstrating how Islamic ethical principles can be operationalized into measurable development indicators. The framework highlights the role of Islamic social finance instruments such as zakat and waqf in promoting inclusive development and poverty alleviation. The FalahDI provides policymakers with a holistic tool for assessing development outcomes and designing policies that integrate economic performance with social justice, ethical governance, and sustainable development. This study contributes to the literature by proposing an integrated Islamic framework for development measurement that bridges ethical principles and empirical evaluation, offering an alternative paradigm for assessing societal prosperity.