The report, published on March 19, is based on three years of research by the Gallup analytics and advisory company on how happy citizens of the 156 countries perceive themselves to be.
This is the second time Finland ranks first.
It is followed by its Nordic neighbours Denmark, Norway and Iceland.
The first ten countries also include the Netherlands, Switzerland, Sweden, New Zealand, Canada and Austria.
Croatia is ranked 75th, which is seven places higher than in the previous ranking. Despite this, Croats seem not to perceive themselves particularly happy.
Countries that consider themselves happier, for example, are Kosovo (46th), Serbia (70th), and Montenegro (73rd).
Italy ranks 36th, Slovenia 44th, and Hungary 62nd. Bosnia and Herzegovina ranks three places below Croatia.
Some of the factors going into the assessment include gross domestic product per capita, healthy life expectancy, generosity, social support, freedom to make life choices, and perceptions of corruption.
South Sudan is at the bottom of the ranking, accompanied by Rwanda, Afghanistan and Central African Republic.
The five countries that have seen the biggest decline in the last ten years are Yemen, India, Syria, Botswana and Venezuela.