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The current study focused on trait-related, general happiness as well as state-related, situational happiness in the aftermath of a national trauma, and examined the inter-relationship between happiness, negative and positive self-labeling, stress and fear of terrorism. This study comprised 844 Israeli citizens (51.1% men, 48.9% women), with ages ranging from 18 to 90 [Mean = 40.34, S.D.=14.87]. Participants responded to questions regarding their demographic background, general and situational happiness, stress, fear of terrorism, and self-perception, with negative self-labeling as a victim and positive self-labeling as a survivor. A Repeated Measures ANOVA revealed a significant disparity between general happiness and situational happiness in the aftermath of the October 7th attack: general happiness levels were notably higher than situational happiness levels. Moreover, there was a significant negative correlation between fear of terrorism and situational happiness. Stress and negative self-labeling exhibited detrimental effects, while positive self-labeling positively impacted the prediction of situational happiness. The comprehensive model accounted for 29% of the variance in situational happiness. Thus, this study elucidates factors influencing happiness amidst national trauma and pioneers the examination of the self-labeling phenomenon in the context of terrorism, exploring its interplay with fear of terrorism and its influence on happiness levels. Our findings not only advance comprehension of the self-labeling process but also provide crucial insights into the nuanced dynamics shaping happiness. Understanding these factors can aid therapists in effectively supporting individuals during and post-events characterized as mass or national trauma. By bolstering happiness levels, it may serve as a robust antidote to the prevalent negative emotions associated with trauma, thereby fostering enhanced overall well-being.