It has been my experience that most people when asked this question, "Are you happy?" tend to answer it in positive... and the huge prevalence of 'happiness' tends to make me quite skeptical of its validity. :)

Personally, i have classified the happy attitude into two types:

Negative Happiness: This consists of a relative psychological indifference to the problems of your life, such that they cease to bother you. You fail in an exam... you just shrug your shoulders and say, "So what? Its not the end of the world." This is negative happiness.

Positive Happiness: This consists of the feeling of pleasure derived from a variety of actions; success, romance, physical pleasures such as having a good tasty meal, aesthetic pleasures such as listening to music or appreciating art, having some sort of an adventure or a thrilling moment.

Of course, in real life, these two types exist in conjunction, though the percentage of their contribution is different in lives of different people.

I would define happy life as one in which happiness dominates over sadness [no life is absolutely happy, ever]. However, i believe, that to lead such a life, the attitude of negative happiness is of greater importance... although it doesn't increase your pleasure, it acts to decrease your feelings of grief, and hence, contribute to an over-all positive balance of happiness over sadness.