People often feel unhappy in the morning but better later in the day, and this pattern may be amplified in the distressed. Past work suggests that one function of cortisol is to energize people in the morning. In a study of 174 students, we tested to see whether daily affect patterns, psychological distress, and awakening cortisol levels were interlinked. Affect levels were assessed using the Day Reconstruction Method and psychological distress was measured using the Depression Anxiety Stress Scales. On average, positive affect increased markedly in a linear pattern across the day, whereas negative affect decreased linearly. For the highly distressed, this pattern was stronger for positive affect. Lower than average morning cortisol, as assessed by two saliva samples at waking and two samples 30 min after waking, predicted a clear increasing pattern of positive affect throughout the day. When we examined the interlinkages between affect patterns, distress, and cortisol, our results showed that a pronounced linear increase in positive affect from morning through to evening occurred chiefly among distressed people with below average cortisol levels upon awakening. Psychological distress, although not strongly associated with morning cortisol levels, does appear to interact with cortisol levels to profoundly influence affect.