Nice question - challenging! Here's the whole sonnet (my answer is below it): When, in disgrace with fortune and men's eyes, I all alone beweep my outcast state, And trouble deaf heaven with my bootless cries, And look upon myself, and curse my fate, Wishing me like to one more rich in hope, Featur'd like him, like him with friends possess'd, Desiring this man's art and that man's scope, With what I most enjoy contented least; Yet in these thoughts myself almost despising, Haply I think on thee, and then my state, Like to the lark at break of day arising From sullen earth, sings hymns at heaven's gate; For thy sweet love remember'd such wealth brings That then I scorn to change my state with kings. It means that, when he remembers the "sweet love" of his sweetheart (lover), he does not want to change places with anyone, not even kings. It's very romantic!

In that closing line, I think that "state" is a synonym for "place." It's one of the meanings of the word but it's an old-fashioned meaning. "When I think of your love, I feel so wealthy that I wouldn't trade places with a king." A few lines earlier, in "then my state, Like to the lark at break of day ... sing hymns," "state" means "state of mind." But I don't think it means that in the last line. I think both meanings A and B are used in the POEM, but that in the last line only meaning A is used. If I'm right, then maybe it is a sort of pun and Shakespeare enjoys using the same word in two different but related meanings.

Well, when I say I scorn to change my state (which, admittedly, I last said in 1964 after a poetry class) I mean I don't want to change my situation. I suppose Willie Shakespeare meant the same.